1 Fair Work Act 2009 s.158 - Application to vary or revoke a modern award Application by the Shop, Distributive and Allied Employees Association (AM2024/24) DEPUTY PRESIDENT BUTLER COMMISSIONER LEE COMMISSIONER HARPER-GREENWELL MELBOURNE, 31 MARCH 2026 Application to vary or revoke a modern award – applications to vary each of the General Retail Industry Award 2020, Fast Food Industry Award 2020, and Pharmacy Industry Award 2020 to remove junior rates for employees aged eighteen and over, and to change the proportions between junior rates and adult rates for persons aged under eighteen – consideration of work value – consideration of the modern awards objective – consideration of the minimum wages objective – application granted in part – variations to be phased in – parties to be given an opportunity to be heard as to phasing arrangements CONTENTS Glossary and abbreviations ........................................................................................................ 2 Introduction ................................................................................................................................ 6 How these proceedings were conducted .................................................................................... 7 The decision: an overview ........................................................................................................ 10 Legislation ................................................................................................................................ 11 The provisions of the modern awards ...................................................................................... 18 Evidence ................................................................................................................................... 24 Submissions .............................................................................................................................. 90 Authorities and literature to which the parties referred us ..................................................... 119 Consideration ......................................................................................................................... 120 Necessity of determination outside the annual wage reviews system .................................... 120 Legislative and arbitral origins and history of junior rates .................................................... 125 Whether we can assume the three modern awards reflected work value and/or met the modern awards objective when made .................................................................................................. 145 Whether we are satisfied variations are justified by work value reasons ............................... 151 Potential employment effects ................................................................................................. 178 The modern awards and minimum wages objectives ............................................................. 219 [2026] FWCFB 75 DECISION [2026] FWCFB 75 2 How we weighed the mandatory considerations, and other relevant matters ........................ 270 Conclusion and disposition .................................................................................................... 276 Attachment A: witnesses ........................................................................................................ 278 Glossary and abbreviations 1967 National Wage Cases decision National Wages Cases 1967 (The Metal Trades Award 1952) [1967] CthArbRp 504; (1967) 118 CAR 655; B2200 1974 National Wage Case decision National Wage Case 1974 [1974] CthArbRp 661; (1974) 157 CAR 293; C769 1999 AIRC Junior Rates Inquiry report Australian Industrial Relations Commission (Justice Munro, Deputy President Duncan, and Commissioner Raffaelli) Junior Rates Inquiry: Report of the Full Bench Inquiring Under Section 120B of the Workplace Relations Act 1996 Mis 306/99 S Print R5300 (4 June 1999) 2012 Modern Awards Review Modern Awards Review 2012 [2012] FWAFB 5600; 223 IR 49 ABS Australian Bureau of Statistics ACCI Australian Chamber of Commerce and Industry Acts Interpretation Act Acts Interpretation Act 1901 (Cth) ACTU Australian Council of Trade Unions Adult Person aged 18 or over Age Discrimination Act Age Discrimination Act 2004 (Cth) Age Matters Report HREOC. (2000). Age Matters: a report on age discrimination. Aged Care Stage 1 decision Aged Care Award 2010; Nurses Award 2020; Social, Community, Home Care and Disability Services Industry Award 2010 [2022] FWCFB 200, 319 IR 127 Aged Care Stage 3 decision Aged Care Award 2010; Nurses Award 2020; Social, Community, Home Care and Disability Services Industry Award 2010 [2024] FWCFB 150, 331 IR 137 Ai Group Australian Industry Group AIFS Australian Institute of Family Studies AIHW Australian Institute of Health and Welfare [2026] FWCFB 75 3 AIRC Australian Industrial Relations Commission Annual Wage Review 2025 Decision Annual Wage Review 2025 [2025] FWCFB 3500; 341 IR 1 ANZSIC Australian and New Zealand Standard Industrial Classification April 1985 National Wage Case decision National Wage Case April 1985 [1985] AIRC 84; [1985] CthArbRp 135; (1985) 297 CAR 7; Print F8100 ARA Australian Retailers Association Award Modernisation decision Award Modernisation - Decision - Full Bench [2008] AIRCFB 1000 BNSW-ABI The New South Wales Business Chamber and Australian Business Industrial C111, or the Employment Discrimination Convention ILO Convention (No. 111) concerning Discrimination in respect of Employment and Occupation (Geneva, 25 June 1958) [1974] ATS 12 CAI Confederation of Australian Industry CoE Characteristics of Employment Survey Coles Coles Supermarkets Australia Pty Ltd Commission The Fair Work Commission established pursuant to section 575 of the Fair Work Act 2009 (Cth) EBIT Earnings Before Interest and Taxes EBITDA Earnings Before Interest, Taxes, Depreciation, and Amortisation Fair Work Act Fair Work Act 2009 (Cth) Fast Food Industry Award Fast Food Industry Award 2020 (MA00003) or its predecessor instrument as the context requires FWO Fair Work Ombudsman Gender-based undervaluation decision Gender-based undervaluation – priority awards review [2025] FWCFB 74; 340 IR 1 General Retail Industry Award General Retail Industry Award 2020 (MA00004) or its predecessor instrument as the context requires [2026] FWCFB 75 4 General Retail Junior Rates (20-year-olds) decision Modern Awards Review 2012 – General Retail Industry Award 2010 – Junior Rates [2014] FWCFB 1846 General Retail Junior Rates (Classifications) decision 4 yearly review of modern awards – Award stage – General Retail Industry Award 2020 [2020] FWCFB 6301; 301 IR 296 Harvester judgement Ex Parte H.V. McKay [1907] CthArbRp 12; (1907) 2 CAR 1 HILDA Household, Income and Labour Dynamics in Australia Survey funded by the Commonwealth of Australia and managed by the University of Melbourne HREOC Human Rights and Equal Opportunity Commission (now Australian Human Rights Commission) Hungry Jack’s Hungry Jack’s Pty Ltd ICESCR The International Covenant on Economic, Social and Cultural Rights (New York, 16 December 1966) [1976] ATS 5 Junior employee A national system employee who is under 21 Mark Foy Shop Assistants Union v. Master Retailers Association and Mark Foy (1907) Vol. 6 A.R. 139 McDonald’s Australia McDonald’s Australia Limited MGA Master Grocers Australia Limited Minor Person aged under 18 NCVER National Centre for Vocational Education Research NES National Employment Standards NMWO 2025 The National Minimum Wage Order 2025. NRA National Retail Association Limited, Union of Employers Parties The SDA, RAFFWU, Youth Law Australia, the Ai Group, the MGA, the ARA, the Pharmacy Guild, Business NSW and Australian Business Industrial, ACCI, and the Franchise Council of Australia [2026] FWCFB 75 5 Penalty Rates decision 4 yearly review of modern awards – Penalty Rates [2017] FWCFB 1001; 265 IR 1 Penalty rates judicial review decision Shop, Distributive and Allied Employees Association v The Australian Industry Group [2017] FCAFC 161; (2017) 253 FCR 368 Pharmacy (APESMA Work Value Claim) decision 4 yearly review of modern awards – Pharmacy Industry Award 2010 [2018] FWCFB 7621, 284 IR 121 Pharmacy (Junior Rates) decision 4 yearly review of modern awards – Pharmacy Industry Award 2010 [2017] FWCFB 3540 Pharmacy Guild The Pharmacy Guild of Australia Pharmacy Industry Award Pharmacy Industry Award 2020 (MA00012) or its predecessor instrument as the context requires Principal parties The SDA, the Ai Group, the MGA, the ARA, and the Pharmacy Guild Productivity Commission Workplace Relations Framework Final Report Productivity Commission. (2015). Workplace Relations Framework, Final Report, Canberra RAFFWU Retail and Fast Food Workers’ Union Re Horticulture Award Re Horticulture Award 2020 [2021] FWCFB 5554; 311 IR 1 Re Security Services Industry Award Re Security Services Industry Award 2010 [2015] FWCFB 620 Real Estate decision Application to vary the Real Estate Industry Award 2020 [2020] FWCFB 3946 Repeal of 4 Yearly Reviews Act Fair Work Amendment (Repeal of 4 Yearly Reviews and Other Measures) Act 2018 RTO Registered Training Organisation SDA Shop, Distributive and Allied Employees Association Secure Jobs, Better Pay Act Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022 (Cth) [2026] FWCFB 75 6 Shop, Distributive and Allied Employees Association v National Retail Association (No 2) Shop, Distributive and Allied Employees Association v National Retail Association (No 2) [2012] FCA 480; (2012) 205 FCR 227 Staff of the FWC Persons engaged under the Public Service Act 1999 who, together with the General Manager established pursuant to section 656 of the Fair Work Act 2009 (Cth), constitute the Statutory Agency that is also known as the Fair Work Commission. Three awards, the The three modern awards the subject of these proceedings, i.e. the General Retail Industry Award, the Fast Food Industry Award, and the Pharmacy Industry Award. Three industries, the General retail industry, fast food industry, and community pharmacy industry. UDHR Universal Declaration of Human Rights Work Value Inquiry Metal Trades Award 1952; Metal Trades Employers Association & Ors v The Amalgamated Engineering Union (Australian Section) & Ors [1967] CthArbRp 1144; (1967) 121 CAR 587 Workplace Relations Act Workplace Relations Act 1996 (Cth) Young adult Person aged 18 to 20 inclusive Introduction [1] On 6 June 2024, the Shop, Distributive and Allied Employees’ Association made an application pursuant to s 157 of the Fair Work Act 2009 (Cth) to increase minimum wages for “junior employees” in three modern awards: the General Retail Industry Award 2020, the Fast Food Industry Award 2020, and the Pharmacy Industry Award 2020. [2] The SDA seeks that the Commission vary each award so that any employee aged eighteen or older is paid at adult rates. They also seek increased rates for workers under 16 – specifically, so that those workers are paid 50% of the relevant adult award minimum rate. In addition, they seek increased rates for 17-year-olds, so that those workers would be paid 75% of the adult rate. The proposed variations would affect: • Table 5 in clause 17.2 of the General Retail Industry Award; • Table 4 of clause 15.2 of the Fast Food Industry Award; and • Table 4 in clause 16.2 of the Pharmacy Industry Award. [2026] FWCFB 75 7 [3] In summary the SDA proposes the following changes to the proportions of the adult rate: Age Current SDA proposal General Retail Industry Award Fast Food Industry Award Pharmacy Award < 16 45% 40% 45% 50% 16 50% 50% 50% 50% (no change) 17 60% 60% 60% 75% 18 70% 70% 70% Adult rate 19 80% 80% 80% Adult rate 20 90%* 90% 90% Adult rate * if employed by the employer for 6 months or less; adult rate if more than 6 months. [4] We have included a glossary of some of the terms used in this decision, above. In addition to that glossary, we wish to address, at the outset, some of the choices we have made in relation to language. [5] This decision has required us to talk about people by reference to their age. In most Australian jurisdictions, a child is a person aged under 18. In Victoria, a child is a person under 15 years old for the purposes of the Child Employment Act 2003. We have preferred to use the term “minor” rather than “child” for people under the age of 18. We use the term “adult” to refer to people who are 18 or over, and we use the narrower term “young adult” to refer to people who are aged 18 or over, but under 21. We use the term “junior employee” consistent with the definition of that term in the Fair Work Act, to mean, relevantly, an employee under 21. Self-evidently “junior employees” can be minors or adults. [6] This application relates to proposed variations to three awards, the General Retail Industry Award, the Fast Food Industry Award, and the Pharmacy Industry Award. We have referred to them collectively as “the three awards.” The awards cover employers and certain employees in the general retail industry, the fast food industry, and the community pharmacy industry. We have referred to these industries collectively as “the three industries.” [7] Junior rates are sometimes referred to as youth rates, youth sub-minimum rates, youth wages, or age-specific minimum wages in the literature. The term “sub-minimum” can be useful because it assists in distinguishing between research into the employment effects of changes to minimum wages and research into the employment effects of changes to specific sub-minimum wages. How these proceedings were conducted [8] This application was made on 6 June 2024. We accept that the SDA is an organisation that is entitled to represent the industrial interests of one or more employees that are covered by, variously, each of the three modern awards the subject of this application. It was not in contest, and we find that the SDA has standing to make this application having regard to section 158(1) of the Fair Work Act. [2026] FWCFB 75 8 [9] The nature of modern awards is that they are regulatory instruments that cover and apply to, relevantly, employees and employers,1 but there are no named respondents to modern awards.2 The power to make determinations varying modern award minimum wages under subsection 157(2) of the Fair Work Act may be exercised by the Commission on its own initiative as well as upon application,3 and if determinations are made they are of general application. [10] The President of the Commission, Justice Hatcher, heard from the applicant and other interested parties as to process, at a directions hearing held on 28 June 2024. A number of interested parties appeared at this directions hearing, though not all of them actively participated in the whole of the proceedings. The President subsequently issued directions on 1 July 2024 contemplating the filing and serving of evidence and submissions in these proceedings. For convenience we have referred to those who ultimately made submissions in these proceedings as “the parties,” and those who both led evidence and made submissions as “the principal parties.” [11] Pursuant to the directions of 1 July 2024, the SDA and any party supporting the application were directed to file materials by 29 October 2024. This date was subsequently extended to 6 November 2024. The SDA filed submissions and evidence in response to the President’s directions. In addition, the association known as the Retail and Fast Food Workers’ Union, and Youth Law Australia, a national community legal centre, filed written submissions, but not evidence. [12] The President also made a direction allowing any party opposing the application to file materials. Amended directions were issued on 24 December 2024, updating the timeframe for these parties to file their materials. After another mention before the President, on 5 May 2025, the timeframe was updated again, with amended directions issued that day to give effect to the change. By further directions issued 10 July 2025, the due date for their materials was ultimately extended to 11 July 2025. In response to these directions, Australian Industry Group, Australian Retailers Association,4 Master Grocers Australia and Pharmacy Guild of Australia filed submissions and evidence. Australian Business Industrial and Business NSW (jointly), Australian Chamber of Commerce and Industry, and Franchise Council of Australia also filed submissions but not evidence. [13] The President’s directions order of 5 May 2025 also included a direction that the SDA file materials in reply by 1 August 2025. This was ultimately extended to 14 August 2025. The SDA filed an outline of submissions in reply and several witness statements, in response to this direction. [14] The matter was listed for hearing in two sessions in October and November 2025, in Melbourne. The first of the sessions was listed for the purpose of hearing the evidence, and was 1 Fair Work Act 2009 (Cth) (“Fair Work Act”) s 47. 2 4 yearly review of modern awards – Fast Food Industry Award 2010 [2019] FWCFB 272, [114]. 3 Fair Work Act s 157(3). 4 Since the hearing the Australian Retailers Association and the National Retail Association Limited, Union of Employers have amalgamated. The amalgamation was foreshadowed by Ms Fleur Brown in her witness statement, Exhibit 108, at [7]. The amalgamated entity is known as the Australian Retail Council. For convenience we have continued to refer to the ARA in this decision. [2026] FWCFB 75 9 scheduled for three full weeks, in the weeks of 20 October, 27 October, and 3 November. The second session was listed for the purpose of hearing closing submissions, with three sitting days allocated (25 to 27 November 2025, inclusive). [15] The matter was listed for a case management conference on 16 September 2025, to manage issues regarding objections to evidence, programming a hearing plan, and remote participation by parties and witnesses. Further directions were issued that day reflecting the outcomes of that conference. [16] The parties produced and negotiated a hearing plan which reduced the number of hearing days required, largely because a large proportion of the lay witnesses were no longer being required for cross-examination. As a result, the first week of the first sitting was able to be vacated. We appreciate the parties contributed to the efficiency of the proceedings. Even with the reduced number of sitting days required, the substantive hearing was extensive, and was held on 27 to 30 October, 5 to 7 November, and 25 to 26 November. [17] In addition to the directions hearings, the case management conference, and the substantive hearing, three interlocutory hearings were conducted. Two of them yielded written decisions5 and one was determined by a decision given ex tempore. In total there were nine days of hearings and an additional six listings (directions hearings, a conference, and the interlocutory hearings). [18] As part of these proceedings, the Commission has issued fourteen orders for the production of documents, and seven confidentiality orders. It has also issued a statement, referred to below. The Commission also dealt with various other interlocutory applications that were ultimately resolved by consent or otherwise withdrawn. [19] Most of the parties were legally represented in these proceedings. Pursuant to subsection 596(3) of the Fair Work Act permission is not required for a person to be represented by a lawyer or paid agent in making a written submission under Parts 2-3 or 2-6 (which deal with modern awards and minimum wages). In addition, rule 13(2) of the Fair Work Commission Rules 2024 allows for legal representation in conferences and hearings in such proceedings, without permission. If permission had been required, we would have granted it in light of the absence of any objection and the greater efficiency obtained, particularly having regard to the complexity of the matter. [20] Evidence was given by eighty-two lay witnesses of whom the majority were not required for cross-examination. Witnesses included employers and employees from the relevant industry sectors, appearing either in person or from around Australia (including regional locations) via video. There were five expert witnesses; two called by the applicant, two by the Ai Group, and one by the ARA. They each gave evidence in person other than Dr Dean Hyslop, who gave evidence from New Zealand, via video. A complete list of witnesses is attached to this decision at Attachment A. [21] In addition to the material received from the parties, the Commission as constituted has had before it documents produced and published by members of the staff of the FWC, 5 Shop, Distributive and Allied Employees Association [2025] FWC 3135; Shop, Distributive and Allied Employees Association [2025] FWC 2906. [2026] FWCFB 75 10 specifically two documents summarising the evidence, and a research reference list. The research reference list was derived from the expert evidence and was not intended to be a comprehensive list of every source referred to by the parties in their submissions. These documents were published well in advance of the substantive hearing, accompanied by a Statement6 as to their purpose and intended use. We are also grateful to the staff of the FWC for their assistance in these proceedings. [22] These proceedings have been conducted in accordance with s 577 of the Fair Work Act. The Commission’s website has been used extensively to provide information to any interested person in order to facilitate broad participation. A dedicated page was created, containing a searchable repository of documents, and interested persons were encouraged to subscribe to the dedicated junior rates subscription notification service to keep them informed. Notices of listing, directions orders, interlocutory applications and orders, submissions, witness statements, substantive correspondence, the hearing book, the exhibit list, and transcripts have been published, with subscribers being notified of publications. When the application was filed, it was reported in the mainstream press as well as in industrial relations and industry publications, and there has also been coverage since, including during the hearing. We consider that any reasonably informed person with an interest in these proceedings would have been aware of them, and anyone wishing to participate would have been able to easily and readily obtain information about how to do so from the Fair Work Commission website. The decision: an overview [23] For the reasons that follow, we have decided to vary each of the three modern awards the subject of these proceedings to phase out junior rates for employees aged eighteen and over, save that discounted rates will continue to apply where the young adult employee has six months’ or less experience with the same employer. We have decided not to vary the rates presently applicable to workers aged under eighteen. We have decided to express a provisional view as to the transitional arrangements for implementing our decision, and to provide a further opportunity to be heard in that regard. [24] In this decision we have set out the relevant legislative provisions, including some observations about the legislative history of the provisions under which this application has been brought. We have then set out relevant provisions from each of the three awards. We have then referred to the lay and expert evidence in these proceedings. Next, we have sought to provide an overview of the parties’ submissions as to whether the Commission has the power to make the variations that the applicant sought, and, if so, whether the power should be exercised. We have also discussed the types of literature to which the parties referred us and indicated how we have dealt with that literature. [25] Having addressed the legislative scheme, evidence, and submissions, we then set out our consideration. We commence with our consideration as to the necessity of dealing with this application and the proposed variations outside the annual wage review system. We have then found it useful to consider the origins and history of age-based wage rates for young employees. We have then considered whether we can make any assumptions, from the outset, about whether the junior rates in the three awards represented a considered assessment of work value, or met 6 Application by Shop, Distributive and Allied Employees Association [2025] FWC 2923. [2026] FWCFB 75 11 the modern awards and/or minimum wages objective, when they were made during award modernisation. We have then considered whether variation of the provisions relating to junior rates is justified for work value reasons. We have then considered the potential effects of the application, if granted, on employment of young people within the general retail, fast food, and pharmacy industries, a question that we consider is relevant to our consideration of various parts of the modern award objective, the minimum wages objective, and the object of the Fair Work Act. We then turn to consider the modern award objective and the minimum wages objective collectively, following a similar approach to that taken in the Annual Wage Review, by considering overlapping provisions together.7 [26] Our decision then goes to other matters we are required to take into account including the object of the Fair Work Act, before setting out how we have weighed the mandatory considerations and other relevant matters. We then provide our conclusion, including our provisional view as to phasing in arrangements, and note that we will provide a further opportunity to be heard in that regard. [27] We must consider the application, the legislative framework, and the principles to be applied, in respect of each of the three modern awards in its own right. As the three modern awards share common origins, and the issues relevant to consideration share some commonalities across the awards, we have dealt with them collectively in our consideration where possible to avoid repetition, while making specific references as necessary. We now turn to the task of setting out the most relevant legislative provisions. Legislation [28] This application has been brought under Part 2-3, Modern Awards, of the Fair Work Act. In the Fair Work Act, “modern award” means a modern award made under Part 2‑3.8 Division 2 of Part 2-3 sets out “overarching provisions” for the Part, including, relevantly, section 134 which provides for the “modern awards objective” and section 135, entitled “Special provisions relating to modern award minimum wages”. [29] Division 3 provides for the terms of modern awards, prescribing terms that may and must be included, and proscribing terms that must not be included. Section 138 provides that a modern award may include terms that it is permitted to include. Relevantly, a modern award may include terms about minimum wages (including wage rates for junior employees, employees with a disability and employees to whom training arrangements apply), and it may include terms about skill-based classifications and career structures, and incentive-based payments, piece rates and bonuses.9 A modern award must include terms that it is required to include, “only to the extent necessary to achieve the modern awards objective and (to the extent applicable) the minimum wages objective.” The minimum wages objective is provided by section 284. [30] Division 5 of Part 2-3, entitled “Exercising modern award powers,” provides, at Subdivision A, for the Commission to exercise powers if necessary to achieve the modern 7 See for example Annual Wage Review 2025 [2025] FWCFB 3500 (“Annual Wage Review 2025 Decision”), [11] – [12]. 8 Fair Work Act s 12. 9 Fair Work Act s 139(1)(a). [2026] FWCFB 75 12 awards objective. Subdivision B provides for the exercise of powers in other circumstances that are not presently relevant. Subdivision A consists of sections 157 and 158, and it is pursuant to these provisions that the present application has been brought before the Commission. [31] Division 6 sets out general provisions relating to modern award powers. In it, section 16210 makes clear that provisions relevant to the Commission’s exercise of its powers set out in Part 5-1 also apply. Section 166 provides that determinations setting, varying or revoking modern award minimum wages generally come into operation on 1 July. [32] Part 2-6 of the Fair Work Act provides for minimum wages. It contains section 284 which as indicated above sets out the minimum wages objective. The Part requires the Commission to conduct an Annual Wage Review of modern award minimum wages and the national minimum wage order. The latter is made each year setting the national minimum wage, special national minimum wages for all award/agreement free junior employees, employees to whom training arrangements apply, and employees with a disability, and the casual loading for award/agreement free employees. In the Fair Work Act, "junior employee" means a national system employee who is under 21.11 Relevant legislative history of Part 2-3, Division 5, Subdivision A [33] Before dealing with the most relevant provisions in detail, it is first useful to make some observations about the legislative history of Part 2-3, Division 5, Subdivision A of the Fair Work Act, which is the subdivision under which this application is being considered. When the Fair Work Act was initially passed, Part 2-3 was significantly different because at that time it included a division that provided for four-yearly reviews of modern awards. This was Division 4. At the time the title of Division 5 was “Exercising modern award powers outside 4 yearly reviews and annual wage reviews.” [34] Section 157, at the time, provided for the Commission to vary (other than in relation to minimum wages), make, or revoke a modern award outside the system of four-yearly reviews if satisfied that was necessary to achieve the modern awards objective. It provided for the Commission to vary modern award minimum wages if satisfied that the variation was “justified by work value reasons” and making the determination outside the system of annual wage reviews and the system of four-yearly reviews was necessary to achieve the modern awards objective. [35] These four-yearly reviews proved to be resource-intensive for all concerned, including the Commission itself, and the Productivity Commission had made recommendations in that regard in its 2015 Workplace Relations Framework Final Report.12 In response, the parliament decided to abolish the four-yearly review process, by passing the Fair Work Amendment (Repeal of 4 Yearly Reviews and Other Measures) Act 2018 (Cth). The Revised Explanatory Memorandum to the bill for that Act stated that it would amend the Fair Work Act to repeal the requirement for the Commission to conduct 4 yearly reviews of modern awards. The Revised 10 Including the note to that section. 11 Fair Work Act, s 12. 12 Productivity Commission. (2015). Workplace Relations Framework, Final Report, Canberra (“Productivity Commission Workplace Relations Framework Final Report”). [2026] FWCFB 75 13 Explanatory Memorandum went on to state that further amendments would “ensure that the residual framework for the making, varying and revoking of modern awards continues to provide a balanced, fair and sensible safety net of terms and conditions of employment.” 13 The Repeal of 4 Yearly Reviews Act repealed Division 4 of Part 2-3, and amended sections 157 and 158 accordingly. [36] The Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022 (Cth) made further amendments to section 157, introducing subsection (2B) requiring that the Commission’s consideration of work value reasons to be free of assumptions based on gender, and to include consideration of whether historically the work has been undervalued because of assumptions based on gender.14 Relevant provisions as currently in force [37] We now turn to Part 2-3, Division 5, Subdivision A as currently in force. As indicated above Division 5 is composed of two sections. The first, section 157, provides: 157 FWC may vary etc. modern awards if necessary to achieve modern awards objective (1) The FWC may: (a) make a determination varying a modern award, otherwise than to vary modern award minimum wages or to vary a default fund term of the award; or (b) make a modern award; or (c) make a determination revoking a modern award; if the FWC is satisfied that making the determination or modern award is necessary to achieve the modern awards objective. Note 1: Generally, the FWC must be constituted by a Full Bench to make, vary or revoke a modern award. However, the President may direct a single FWC Member to make a variation (see section 616). Note 2: Special criteria apply to changing coverage of modern awards or revoking modern awards (see sections 163 and 164). Note 3: If the FWC is setting modern award minimum wages, the minimum wages objective also applies (see section 284). Note 4: If the FWC is making, varying or revoking a modern award that the President considers might relate to the road transport industry, it must take into account the road transport objective (see section 40D). (2) The FWC may make a determination varying modern award minimum wages if the FWC is satisfied that: (a) the variation of modern award minimum wages is justified by work value reasons; and (b) making the determination outside the system of annual wage reviews is necessary to achieve the modern awards objective. 13 Revised Explanatory Memorandum to the Fair Work Amendment (Repeal of 4 Yearly Reviews and Other Measures) Bill 2017, Page i. 14 In addition, the Fair Work Legislation Amendment (Closing Loopholes No 2) Act 2024 added a new note to section 157, regarding the application of the road transport objective to some matters, but it is not presently relevant. [2026] FWCFB 75 14 Note: As the FWC is varying modern award minimum wages, the minimum wages objective also applies (see section 284). (2A) Work value reasons are reasons justifying the amount that employees should be paid for doing a particular kind of work, being reasons related to any of the following: (a) the nature of the work; (b) the level of skill or responsibility involved in doing the work; (c) the conditions under which the work is done. (2B) The FWC’s consideration of work value reasons must: (a) be free of assumptions based on gender; and (b) include consideration of whether historically the work has been undervalued because of assumptions based on gender. (3) The FWC may make a determination or modern award under this section: (a) on its own initiative; or (b) on application under section 158. [38] As can be appreciated from the notes to subsection 157(1), some but not all such matters are required to be dealt with by an Expert Panel.15 Otherwise, they are generally determined by a Full Bench, as was the case in these proceedings. [39] We now turn to the overarching provisions for Part 2-3. It is convenient to set out the modern awards objective in full. Section 134 provides: 134 The modern awards objective What is the modern awards objective? (1) The FWC must ensure that modern awards, together with the National Employment Standards, provide a fair and relevant minimum safety net of terms and conditions, taking into account: (a) relative living standards and the needs of the low paid; and (aa) the need to improve access to secure work across the economy; and (ab) the need to achieve gender equality in the workplace by ensuring equal remuneration for work of equal or comparable value, eliminating gender-based undervaluation of work and providing workplace conditions that facilitate women’s full economic participation; and (b) the need to encourage collective bargaining; and (c) the need to promote social inclusion through increased workforce participation; and (d) the need to promote flexible modern work practices and the efficient and productive performance of work; and (da) the need to provide additional remuneration for: (i) employees working overtime; or (ii) employees working unsocial, irregular or unpredictable hours; or 15 see also Fair Work Act s 617. [2026] FWCFB 75 15 (iii) employees working on weekends or public holidays; or (iv) employees working shifts; and (f) the likely impact of any exercise of modern award powers on business, including on productivity, employment costs and the regulatory burden; and (g) the need to ensure a simple, easy to understand, stable and sustainable modern award system for Australia that avoids unnecessary overlap of modern awards; and (h) the likely impact of any exercise of modern award powers on employment growth, inflation and the sustainability, performance and competitiveness of the national economy. This is the modern awards objective. When does the modern awards objective apply? (2) The modern awards objective applies to the performance or exercise of the FWC’s modern award powers, which are: (a) the FWC’s functions or powers under this Part; and (b) the FWC’s functions or powers under Part 2-6, so far as they relate to modern award minimum wages. Note 1: The FWC must also take into account the objects of this Act and any other applicable provisions. For example, if the FWC is setting, varying or revoking modern award minimum wages, the minimum wages objective also applies (see section 284). Note 2: Further, the FWC must take into account the road transport objective when performing certain functions: see section 40D and subsection 617(10B). [40] Section 135 relates specifically to minimum wages. It relevantly provides: 135 Special provisions relating to modern award minimum wages (1) Modern award minimum wages cannot be varied under this Part except as follows: (a) modern award minimum wages can be varied if the FWC is satisfied that the variation is justified by work value reasons (see subsection 157(2)); (b) modern award minimum wages can be varied under section 160 (which deals with variation to remove ambiguities or correct errors) or section 161 (which deals with variation on referral by the Australian Human Rights Commission). Note 1: The main power to vary modern award minimum wages is in annual wage reviews under Part 2-6. Modern award minimum wages can also be set or revoked in annual wage reviews. Note 2: For the meanings of modern award minimum wages, and setting and varying such wages, see section 284. (2) In exercising its powers under this Part to set, vary or revoke modern award minimum wages, the FWC must take into account the rate of the national minimum wage as currently set in a national minimum wage order. [41] The reference to “this Part” in section 135 is, as will be clear from the foregoing, a reference to Part 2-3, Modern Awards. Section 135(1)(a) imposes a condition on the exercise of the power under section 157 of the Fair Work Act. [2026] FWCFB 75 16 [42] Section 138 provides that a modern award may include terms that it is permitted to include and must include terms that it is required to include, only to the extent necessary to achieve the modern awards objective and (to the extent applicable) the minimum wages objective. [43] The minimum wages objective is provided by section 284, which is an ‘overarching’ provision for Part 2-6, but which is also applied to Part 2-3 by operation of subsection 284(2)(b). It is also convenient to set out section 284 in full. It provides: 284 The minimum wages objective What is the minimum wages objective? (1) The FWC must establish and maintain a safety net of fair minimum wages, taking into account: (a) the performance and competitiveness of the national economy, including productivity, business competitiveness and viability, inflation and employment growth; and (aa) the need to achieve gender equality, including by ensuring equal remuneration for work of equal or comparable value, eliminating gender-based undervaluation of work and addressing gender pay gaps; and (b) promoting social inclusion through increased workforce participation; and (c) relative living standards and the needs of the low paid; and (e) providing a comprehensive range of fair minimum wages to junior employees, employees to whom training arrangements apply and employees with a disability. This is the minimum wages objective. When does the minimum wages objective apply? (2) The minimum wages objective applies to the performance or exercise of: (a) the FWC’s functions or powers under this Part; and (b) the FWC’s functions or powers under Part 2-3, so far as they relate to setting, varying or revoking modern award minimum wages. Note: The FWC must also take into account the objects of this Act and any other applicable provisions. For example, if the FWC is setting, varying or revoking modern award minimum wages, the modern awards objective also applies (see section 134). Meaning of modern award minimum wages (3) Modern award minimum wages are the rates of minimum wages in modern awards, including: (a) wage rates for junior employees, employees to whom training arrangements apply and employees with a disability; and (b) casual loadings; and (c) piece rates. [2026] FWCFB 75 17 Meaning of setting and varying modern award minimum wages (4) Setting modern award minimum wages is the initial setting of one or more new modern award minimum wages in a modern award, either in the award as originally made or by a later variation of the award. Varying modern award minimum wages is varying the current rate of one or more modern award minimum wages. Other relevant provisions [44] As the note to subsection 284(2) of the Fair Work Act states, the Commission also has to take into account the Act’s objects. It is explicitly required to do so pursuant to section 578(a). Most relevantly, section 3 provides: 3 Object of this Act The object of this Act is to provide a balanced framework for cooperative and productive workplace relations that promotes national economic prosperity and social inclusion for all Australians by: (a) providing workplace relations laws that are fair to working Australians, promote job security and gender equality, are flexible for businesses, promote productivity and economic growth for Australia’s future economic prosperity and take into account Australia’s international labour obligations; and (b) ensuring a guaranteed safety net of fair, relevant and enforceable minimum terms and conditions through the National Employment Standards, modern awards and national minimum wage orders; and … (g) acknowledging the special circumstances of small and medium‑sized businesses. [45] As well as requiring the Commission to take into account the Fair Work Act and its Parts’ objects, section 578 also requires that in performing functions or exercising powers the Commission must take into account equity, good conscience and the merits of the matter, and the need to respect and value the diversity of the workforce by helping to prevent and eliminate discrimination on the basis of, inter alia, age. At the same time, the Fair Work Act modifies the meaning of “discriminatory” by excluding from its scope terms of awards or enterprise agreements providing for junior rates.16 This is consistent with the approach under the Age Discrimination Act 2004 (Cth), which provides an exemption from the scope of unlawful discrimination, for “youth wages.”17 [46] The Fair Work Act requires the Commission to perform its functions and exercise its powers in a manner that is fair and just; is quick, informal and avoids unnecessary technicalities; is open and transparent; and promotes harmonious and cooperative workplace relations.18 16 Fair Work Act, ss 153(3) and 195(3) respectively. 17 Age Discrimination Act 2004 (Cth) (“Age Discrimination Act”) s 25. 18 Fair Work Act s 577. [2026] FWCFB 75 18 [47] The Commission is not required to make a decision in the terms applied for.19 It is entitled to inform itself in such manner as it considers appropriate.20 It is not bound by the rules of evidence and procedure.21 [48] Having set out the legislation we will now turn to the provisions of the three modern awards the subject of these proceedings. The provisions of the modern awards [49] We will now set out the most relevant provisions of the three modern awards the subject of these proceedings. Each of the General Retail Industry Award, the Fast Food Industry Award, and the Pharmacy Industry Award was made in the course of award modernisation, a process that commenced in 2008 following reforms to the statutory scheme. We have referred to this process and the making of the three modern awards below. It is convenient to set out the most relevant provisions of the three awards, relating to junior rates and classifications, here. We will start with the General Retail Industry Award. General Retail Industry Award [50] As indicated above the SDA has applied to vary clause 17.2 of the General Retail Industry Award in order to alter the junior rates payable to retail employees at Levels 1–3. Clause 17 provides for minimum rates. Clause 17.1 provides for adult rates. Clause 17.2 provides for junior rates. The remainder of the clause deals with rates for apprentices and adult apprentices, workers undertaking higher duties, employees eligible for a supported wage, and employees undertaking traineeships. Clause 17.1 provides for adult rates for the classifications Retail Employee Levels 1 through 8. Clause 17.2 provides: 17.2 Junior rates (retail employee levels 1, 2 and 3 only) NOTE: Junior employee is defined in clause 2—Definitions. An employer must pay a junior employee, who is classified as a retail employee level 1, 2 or 3 and aged as specified in column 1 of Table 5—Junior rates (retail employee levels 1, 2 and 3 only), the minimum percentage specified in column 2 of the minimum rate that would otherwise be applicable under Table 4—Minimum rates. Table 5—Junior rates (retail employee levels 1, 2 and 3 only) Column 1 Age Column 2 % of minimum rate Under 16 years of age 45% 16 years of age 50% 17 years of age 60% 18 years of age 70% 19 years of age 80% 20 years of age and employed by the employer for 6 months or less 90% 19 Fair Work Act s 599. 20 Fair Work Act s 590. 21 Fair Work Act s 591. [2026] FWCFB 75 19 Column 1 Age Column 2 % of minimum rate 20 years of age and employed by the employer for more than 6 months 100% [51] Clause 2 of the General Retail Industry Award provides that junior employee means an employee who is less than 21 years of age. [52] Clause 17.2 is not the only provision for special rates. Clause 17.3 provides for apprentice rates, and clause 17.4 for adult apprentice rates. Clause 17.5 is a higher duties provision. Clause 17.6 refers to Schedule E for employees eligible for a supported wage because of disability. Clause 17.7 incorporates Schedule E to the Miscellaneous Award 2020, which sets out minimum wages and conditions for employees undertaking traineeships. [53] There was a substantial change to junior rates in the General Retail Industry Award in the General Retail Junior Rates (20-year-olds) decision,22 undisturbed on judicial review.23 Specifically, the award was varied to require that 20-year-old retail employees who had worked for an employer for more than six months be paid at adult rates. There was a further significant change to the General Retail Industry Award junior rates in the General Retail Junior Rates (Classifications) decision24 to vary the award to provide that junior rates would apply only to classification levels 1, 2 and 3, rather than all eight classification levels.25 [54] The Retail Employee Level 1 classification is broad and covers a wide range of functions. Schedule A of the General Retail Industry Award provides for classification definitions. Clause A1.11 provides, relevantly: A.1 Retail Employee Level 1 A.1.1 Retail Employee Level 1 means an employee performing any of the following functions at a retail establishment: (a) receiving or preparing for sale or displaying goods in or about a shop; or (b) pre-packing, packing, weighing, assembling, pricing or preparing goods, provisions or produce for sale; or (c) displaying, filling shelves, replenishing or any other method of exposing or presenting goods for sale; or (d) selling or hiring goods by any means; or (e) receiving, arranging or paying by any means; or (f) recording a sale or sales by any means; or (g) wrapping or packing goods for despatch or despatching goods; or (h) delivering goods; or (i) window dressing or merchandising; or 22 Modern Awards Review 2012 – General Retail Industry Award 2010 – Junior Rates [2014] FWCFB 1846 (“General Retail Junior Rates (20-year-olds) decision”). 23 National Retail Association v Fair Work Commission [2014] FCAFC 118; 225 FCR 154. 24 4 yearly review of modern awards – Award stage – General Retail Industry Award 2020 [2020] FWCFB 6301; 301 IR 296 (“General Retail Junior Rates (Classifications) decision”). 25 With subsequent decisions as to transitional arrangements for implementation issued on 4 December 2020, [2020] FWCFB 6445], and on 26 April 2021 [2021] FWCFB 2206]. [2026] FWCFB 75 20 (j) loss prevention; or (k) demonstrating goods for sale; or (l) providing information, advice or assistance to customers; or (m) receiving, preparing or packing goods for repair or replacement or making minor repairs to goods; or (n) as a direct employee of the retailer, providing cleaning, store greeting, security, lift attending, store cafeteria services or food services; or (o) any function of a Clerical Assistant Level 1; or (p) work that is incidental to, or connected with, any of the functions mentioned in clause A.1.1(a) to clause A.1.1(o). A.1.2 A Retail Employee Level 1 must undertake duties as directed within the limits of their competence, skills and training, including incidental cleaning. For this purpose, the cleaning of toilets is not incidental cleaning except for a take away food establishment. A.1.3 Indicative job titles that are usually within the definition of a Retail Employee Level 1 are: (a) shop assistant; (b) clerical assistant; (c) check-out operator; (d) store worker; (e) reserve stock hand; (f) driver; (g) boot or shoe repairer (not qualified); (h) window dresser (not qualified); (i) loss prevention officer; (j) photographic employee; (k) store greeter; (l) assembler; (m) ticket writer (not qualified); (n) trolley collector; (o) video hire worker; (p) telephone order salesperson; (q) door-to-door salesperson or retail outdoor salesperson; (r) demonstrator or merchandiser not elsewhere classified (including a demonstrator or merchandiser who is not a direct employee of the retailer). [55] The clause goes on to provide for definitions for the Clerical Assistant role. The Level 2 definition is brief: A.2 Retail Employee Level 2 A.2.1 Retail Employee Level 2 means an employee performing work at a retail establishment at a higher skill level than a Retail Employee Level 1. A.2.2 Indicative job titles that are usually within the definition of a Retail Employee Level 2 include: (a) forklift operator; [2026] FWCFB 75 21 (b) ride on equipment operator. [56] Level 3 is similar and also contemplates supervision. The definition is: A.3 Retail Employee Level 3 A.3.1 Retail Employee Level 3 means an employee performing work at a retail establishment at a higher level than a Retail Employee Level 2. A.3.2 Indicative of the tasks that might be required at this level are the following: (a) providing supervisory assistance to a designated section manager or team leader; or (b) opening or closing the premises or providing associated security; or (c) securing cash; or (d) fitting a surgical corset. A.3.3 Indicative job titles that are usually within the definition of a Retail Employee Level 3 include: (a) machine operators; (b) second-in-charge to department manager; (c) senior salesperson (including designated second-in-charge of a section); (d) corsetiere; (e) driver selling stock; (f) cook (not qualified) in a cafeteria; (g) senior loss prevention officer, including an armed loss prevention officer; (h) loss prevention officer supervisor; (i) Designated second-in-charge to a service supervisor; (j) person employed alone, with responsibilities for the security and general running of a shop. [57] As can be appreciated these three classifications, to which junior rates apply, can encompass a broad range of jobs in general retail. As can also be appreciated, following the implementation of the General Retail Junior Rates (Classifications) decision there are several classifications under the General Retail Industry Award to which junior rates do not apply. Fast Food Industry Award [58] The SDA applies to vary clause 15.2 of the Fast Food Industry Award to alter the junior rates payable to all employees under 21 years of age. Clause 15.1 provides for adult rates for the classifications Fast food employee level 1, Fast food employee level 2, Fast food employee level 3 (in charge of one or no person) and Fast food employee level 3 (in charge of 2 or more people). Clause 15.2 provides: 15.2 Junior rates An employer must pay a junior employee, as defined in clause 2—Definitions, the minimum percentage of the adult rate applicable to the employee’s classification in clause 15.1 for ordinary hours of work as follows: [2026] FWCFB 75 22 Age % of applicable adult rate Under 16 years of age 40 16 years of age 50 17 years of age 60 18 years of age 70 19 years of age 80 20 years of age 90 21 years of age 100 NOTE: See Schedule A—Summary of Hourly Rates of Pay for a summary of hourly rates of pay for junior employees including casual, overtime and penalty rates. [59] Clause 2 provides that “junior employee means an employee who is under 21 years of age.” Clause 15.3 provides for the supported wage system, and clause 15.4 for the national training wage. [60] The Fast Food Industry Award applies junior rates to all classifications: Fast food employee level 1, Fast food employee level 2, and Fast food employee level 3. There are different rates for level 3 employees who are in charge of one person (or no persons), and those who are in charge of 2 or more people. The classification descriptions are brief and can be set out conveniently: 12.4 Classification definitions (a) Fast Food Employee Level 1 (i) An employee engaged in the preparation, the receipt of orders, cooking, sale, serving or delivery of meals, snacks and/or beverages which are sold to the public primarily to take away or in food courts in shopping centres. (ii) A Fast Food Employee Level 1 will undertake duties as directed within the limits of their competence, skills and training, including incidental cleaning and cleaning of toilets. (b) Fast Food Employee Level 2 An employee who has the major responsibility on a day-to-day basis for supervising Fast Food employees Level 1 and/or training new employees or an employee required to exercise trade skills. (c) Fast Food Employee Level 3 An employee appointed by the employer to be in charge of a shop, food outlet or delivery outlet. [61] As can readily be appreciated this means a person can be in charge of a food outlet and still be eligible for junior rates. Schedule A to the Fast Food Industry Award makes clear that junior rates apply to all three of the classification levels. There have been minor but not material changes to the junior rates provision, clause 15.2 of the Fast Food Industry Award since it was [2026] FWCFB 75 23 made. The Commission has not materially varied the junior rates provision in the Fast Food Industry Award since that award was made during award modernisation.26 Pharmacy Industry Award [62] The SDA applies to vary the clause 16.2 of the Pharmacy Industry Award, to alter the junior rates payable to pharmacy assistants at Levels 1–2. Clause 16.1 provides for adult rates for the following classifications: • Pharmacy assistant levels 1 to 4 • Pharmacy student (varying, depending on progress through their course) • Pharmacy intern, 1st half of training and 2nd half of training • Pharmacist • Experienced pharmacist • Pharmacist in charge • Pharmacist manager [63] Clause 16.2 provides: 16.2 Junior rates (pharmacy assistants levels 1 and 2 only) An employer must pay an employee, who is classified as a pharmacy assistant level 1 or level 2 and aged as specified in column 1 of Table 4—Junior rates (pharmacy assistants levels 1 and 2 only), at least at the percentage specified in column 2 of the minimum rate that would otherwise be applicable under Table 3— Minimum rates: Table 4—Junior rates (pharmacy assistants levels 1 and 2 only) Column 1 Age Column 2 % of minimum rate Under 16 years of age 45% 16 years of age 50% 17 years of age 60% 18 years of age 70% 19 years of age 80% 20 years of age 90% [64] Clause 16.3 then makes provision for Pharmacy students, a different classification. It provides for conditions for determining which pharmacy student rate applies (when a year of a course commences, application to Masters course, etc) for pharmacy students enrolled in tertiary education. Schedule A, which sets out classification definitions, provides that a “pharmacy student is an employee who is undertaking training as part of an approved program of study, as defined by the Health Practitioner Regulation National Law.” Clause 16.4 provides for the supported wage system, and clause 16.5 for the national training wage. 26 Closing Submissions of the SDA filed 25 November 2025 (“SDA’s closing submissions”), [82]. [2026] FWCFB 75 24 [65] The award was varied by consent, by a 2017 decision of the Commission, to remove junior rates for all classifications other than for pharmacy assistants working at classification levels 1 and 2.27 The two classifications to which junior rates apply are as follows:28 A.1 Pharmacy assistant level 1 is an employee working as a pharmacy assistant in a community pharmacy who has not acquired the competencies required to hold a qualification in Community Pharmacy and is not covered by any other classification in this Schedule. A.2 Pharmacy assistant level 2 is an employee who has acquired the competencies required to be the holder of a Certificate II in Community Pharmacy, as determined by the National Quality Council or a successor body. Evidence [66] Five of the parties led evidence: SDA, Ai Group, MGA, ARA, and the Pharmacy Guild. The other parties did not lead evidence but made various assertions of fact in their submissions. Where those assertions related to issues that were relevant but were not contested or controversial in these proceedings, including references to government statistics and the like, we have taken them into account. [67] The SDA tendered statements from sixty lay witnesses, all available, but most not required, for cross-examination. Its lay witnesses were from diverse geographical areas and had worked for a variety of employers relevant to these proceedings. The SDA also called two expert witnesses, Professor Jeff Borland, Truby Williams Professor of Economics, Department of Economics University of Melbourne and Professor Martin O’Brien, MBA Director Faculty of Business and Law University of Wollongong. [68] The Ai Group called ten lay witnesses, from four major employers in the fast food industry. Not all major fast food companies or brands provided witnesses. The Ai Group also called two expert witnesses, Dr Dean Hyslop, Senior Fellow at Motu Economic and Public Policy Research Wellington, New Zealand and Professor Philip Lewis, Emeritus Professor in Economics, University of Canberra. The ARA’s three lay witnesses were an ARA employee, a senior manager from Coles, and a State operations manager from Kmart Group (including Kmart and Target). Again, not all major supermarkets or department stores provided witnesses. The ARA also called an expert witness, Professor Richard Holden, Scientia Professor of Economics, School of Economics, UNSW Business School. The MGA called three witnesses, all from regional areas, one from a liquor store and two from independent supermarkets. The Pharmacy Guild called six lay witnesses from community pharmacies. [69] The Franchise Council said it had consulted its membership widely in preparing its written submission and submits that its members, in particular small business members, were reluctant to give evidence under their own name or brand for fear of reprisal or negative media stories relating to the matter. The basis for this fear was not otherwise articulated, and nor did the Franchise Council indicate who its members feared might take reprisals against them. Nor 27 4-yearly review of modern awards – Pharmacy Industry Award 2010 [2017] FWCFB 3540 (“Pharmacy (Junior Rates) decision”). 28 Pharmacy Industry Award, Schedule A, cll A.1 and A.2. [2026] FWCFB 75 25 did the Franchise Council make submission as to why laws protecting witnesses would not be sufficient protection from reprisals. We observe that many lay witnesses gave evidence in support of and against this application, and many of the witnesses (or the party calling them) obtained reasonable and proportionate confidentiality arrangements. Whether members of the Franchise Council wished to give evidence or not was a matter for them. However, persons wanting to have their assertions of fact about contested issues given weight in these proceedings ought to have put themselves forward as witnesses and made themselves available for cross- examination if required, as others did. Objections to evidence – how handled [70] The principal parties exchanged schedules of objections in advance of the hearing, and many were able to be resolved by consent. [71] Some objections to evidence were contested. The SDA provided two schedules of objections on 28 October: one setting out their own objections and employer responses to them, and another setting out the Ai Group and ARA objections, and the SDA’s response to them. It was ultimately not necessary for the parties to file a similar schedule in relation to the MGA’s objections.29 [72] The general approach of the parties was that we should take into account the objections in determining what use to make of the material, without necessarily needing to formally rule on each.30 However, the SDA did seek a ruling in relation to the evidence of Ms Brown, which we have discussed below, and filed31 a specific additional objection about the expert evidence of Professor Holden, also discussed below. In addition to the formal objections there was some criticism by parties of each other’s evidence, for being, variously, vague, non-specific, irrelevant, scandalous, anecdotal, opinion, or hearsay. There was also acceptance by some if not all parties that anecdotal accounts were often received in award variation cases. We have taken into account the schedules of objections, the additional written objection, and the submissions made at hearing. Having regard to the nature of the application, the non-application of the rules of evidence, and the power to inform ourselves, we generally preferred to admit tendered material into the evidence. However, we have been appropriately cautious as to the weight to be given to material that might otherwise have been excluded. Significance of most SDA lay witnesses not being required for cross-examination [73] The SDA submitted that for witnesses not required for cross-examination, we should treat those witnesses’ evidence as uncontested. This matter proceeded by witness statement and it is clear enough from the employer lay witnesses’ statements that those witnesses took issue with some of the assertions in the SDA’s lay witnesses’ statements. The SDA had an opportunity to put on reply statements, which it did. In those circumstances we do not consider areas of disagreement discernible from the initial statements, or as between the reply statements and the employers’ statements, to be uncontested. No fairness issue arises because of the opportunity to respond. We also do not consider that assertions in the reply statements can be 29 Transcript, PN1158. All references in this decision with the prefix “PN” are to the transcript. 30 PN825-826 and PN1158. 31 On 29 October 2025. [2026] FWCFB 75 26 considered uncontested if they went to matters that were already in controversy between the parties having regard to the statements already filed. The absence of cross-examination does not in our view, in that circumstance and in these proceedings, mean that the relevant employer party conceded any pre-existing factual controversy. The Ai Group made submissions as to which witnesses’ evidence should be preferred in the form of its aide memoire on lay evidence in reply. Again, there is no fairness issue because the parties were on notice in advance of the content of each other’s evidence-in-chief and knew the areas of evidentiary contest. We also consider that if there were any objections to any parts of any witness statement, where we were encouraged to deal with the objections as a matter of weight, it will have been clear enough that the matters were in contest. SDA lay evidence [74] The SDA called evidence from sixty lay witnesses, only four of whom (from the community pharmacy industry) were required for cross-examination. [75] The Commission had granted a confidentiality order prohibiting publication of witnesses’ names, ages, dates of birth, and other identifying information.32 In preparing these reasons we have decided to refer to witnesses by their initials, not by name, consistent with our earlier approach. We use the pronoun ‘they’ in most cases to further avoid identification. We have also avoided referring to their dates of birth. In light of the confidentiality order, in many cases rather than repeating their specific ages, as set out in their statements, we have instead referred to them as a minor or a young adult. However, we have considered it necessary to refer to some of the SDA lay witnesses’ evidence that had previously been covered by that order, for example where it covered their evidence as to the age they were when they took on particular roles, duties or responsibilities, or when relevant events occurred. We have decided to vary the confidentiality order accordingly. We consider this consistent with the approach taken by counsel for the SDA during closing submissions. [76] Among the SDA’s lay witnesses were a mother and daughter who had worked in the pharmacy industry. Some of the evidence went to their particular experiences in connection with that circumstance. We have not considered it necessary to refer to these matters in detail. SDA witnesses not required for cross-examination [77] We consider it useful to first canvass the statements of the SDA’s lay witnesses who were not required for cross-examination. In doing so, we refer to the state of events as at the time they made their statements in and around November 2024. The lay witnesses variously gave evidence about their pay, classification, basis of engagement, whether they were covered by an enterprise agreement (if they knew), hours, duties, training, experience with workers of different ages, and financial and personal circumstances. They lived and worked variously in urban, suburban, and regional areas, across the country. The SDA provided signed versions of all but one. The statement of JH was not signed but had been adopted; the relevant employer party, the ARA, did not object to it being admitted.33 32 Re Shop, Distributive and Allied Employees Association [2025] FWC 3135 and the associated order PR792789. 33 PN1125 - PN1126. [2026] FWCFB 75 27 [78] WA was a 20-year-old part-time Team Member (retail assistant) at Kmart. They had commenced there as a young adult. They had previously worked at Coles Services as a minor. They gave evidence about their duties, conditions, and employment at both employers. They had started as a casual and had transitioned to part-time. Their responsibilities included backfill, customer returns, tidying the store, customer service, sequencing (unpacking new stock from deliveries), and occasionally working at the checkout. Their evidence referred to the training and induction they had received at Kmart, and the assistance they provided in training other employees. They gave evidence that there were no significant differences in the tasks performed by “Team Members” of different ages at Kmart. They said older staff members, particularly those over 21, tend to work at the service desk or in supervisory roles, rather than “Team Member” roles. They also gave evidence as to their personal financial circumstances, saying they lived with their partner, and describing their weekly expenses including rent, utilities, groceries, car insurance and loan repayments.34 [79] KB had started working at Kmart at age 15. They had since worked at Coles and a food retailer. They now worked for Big W and had done so for around 3 years. They were over 20 years old, almost finished a Bachelor’s degree, and working in the Party section of Big W at one of its stores. They gave evidence as to the basis of their engagement, the hours worked, the training received, and their duties at each of the four employers. They had moved out of home at age 16 and had been living out of home ever since. As to their current responsibilities in the Party section, KB said they made sure it looked neat, ordered and filled stock, ensured tickets on items were correct, served customers and managed customer orders, and made the balloon orders. They said they train new employees and had trained six new employees to work in Party. They drafted and updated a diary that contains the orders for other employees to make up when they are on shift and write in the diary other important tasks for other employees to do when they (KB) are not working. They said they were effectively in charge of the party shop, and though they had management support, the Store Manager left them to run the Party section by themself. As to the duties of workers of different ages at the two Big W stores, KB’s evidence was that there had been employees aged from 15 years old to over 60 years old. In the Party section where they worked at the time of the statement, there had been two 18-year-old employees, a 22-year-old, a 24-year-old, two employees aged in their late 20s, and one aged around 50, all employed at the same level. They said that each of the employees in the Party section is supposed to do the same job. They said there are no different or advanced tasks that any of those employees performed. They said new employees and the older workers do a little bit less. But, they said, employees improve if they have been at the job for a while; they develop a knowledge of the store.35 [80] CB was a Manager of a McDonald’s, aged over 20, in their second year of tertiary education. They had worked at McDonald’s since age 15, initially as a “Crew Member”. Their evidence went to their training and their duties as a Crew Member. They stated they were appointed as a Crew Trainer at age 19. The duties of that role included training new employees, or training experienced employees at a new station. They completed training plans for each and kept records of the training and the employee’s performance during training. They said they did not receive a pay increase on becoming a Crew Trainer. They had been trained to become a manager; the training took eight months to complete. They became a Shift Manager as a young 34 Exhibit 14. 35 Exhibit 15. [2026] FWCFB 75 28 adult. They received a pay increase at the time. In December 2023 they had stopped being a Shift Manager and went back to being a Crew Trainer. They said that they had stopped because they had not enjoyed the management role, citing the busyness of the store and the pressure they were under when staff called in sick or did not show up. CB described the duties particular to the roles of Crew Trainer and as a manager, including how they made rostering decisions when someone was absent. CB also described the age distribution at the store where they worked. They stated it was fairly even across the age range 15 to 25. They said that to their knowledge there were no employees older than 25. They described several roles in “drive thru”36, front counter, and making food and beverages. They said that each employee performed the same task in each of these roles, and each member of “the Crew” did the same work in these roles regardless of their age.37 [81] At the time of making their statement PB was a young adult and employed at a retail store as a sales assistant. They had previously worked for two other retailers, and, before that, a café. They had been 16 when they started in retail. PB gave evidence about the training PB had been given, and about their duties. At their current job there was a sales assistant aged 25, and two aged in their early 30s. They said their role was the same as all the other sales assistants’.38 [82] RB was a young adult employed at Kmart, having commenced a few months before giving their statement. They were in their first year of university. They had previously worked at McDonalds from age 15 for a few months but had not felt comfortable working there because of the pace, which led them to feel that customers and other staff were waiting on them. As to their work at Kmart, they gave evidence as to their training and their duties, as well as the basis for their engagement (casual). As to the age distribution, they stated around 20% of employees are over 25 years old, including some employees over age 50. They said around 30% of employees are aged between 14 and 16, around 20% are 17 or 18, around 10% are 19 or 20, and around 10% are 21 to 25.39 They said they had observed Team Members who were older and younger than them working in the sections in which they worked. They said young people and older employees perform the same duties. They said that in some sections employees who are over 50 years old are expected to do a little bit less than younger employees. They gave the example of Self-Service Checkout, saying that if the store is quiet, a Manager would ask them to clean up a nearby section of the store, and they have not seen the Manager ask an older employee to do this. They also gave evidence as to their financial circumstances, including stating they live at home with their parents, and receive Youth Allowance.40 [83] AB was a 20-year-old employed as a “Team Member” who had been working at Coles since age 17. They were a casual employee, classified at Level 1, who worked an average of fifteen hours per week. They had previously worked for a food retailer as a “sandwich artist.” They were also enrolled at university and volunteered at a coastal education facility for primary 36 We have attempted to use the same spelling as that used by the witness. So, for example, “drive through” will often be referred to as “drive thru” in these reasons. Some words are used as both proper nouns to refer to department names, and also as ordinary nouns to refer to functions. For example, in these reasons we have capitalised the first letter of “Nightfill” as a proper noun where a witness has done so, while in other parts we have referred to “the nightfill section.” 37 Exhibit 16. 38 Exhibit 17. 39 These estimates do not total 100%, presumably because they are rounded down, signified by the use of the word “around.” 40 Exhibit 18. [2026] FWCFB 75 29 school children. Their statement went to their employment and duties at each of Coles and the food retailer. At Coles, they worked in both Nightfill and Grocery. In each, they said the work performed as a 20-year-old was the same as the work they had been doing as a 17-year-old. They had not been a supervisor but on two occasions new employees had been assigned to ‘shadow’ them. They said that when they were 18, a 22 year old had been assigned to shadow them. They thought they were now on the full adult rate of pay. They said they had no other sources of income and were saving for a deposit on a house or to otherwise be able to move out of their parents’ home.41 [84] BB was a twenty-five year old organiser for the SDA. They had previously worked for McDonalds, from age 15, and for an independent supermarket. At McDonalds they had been a Crew Member and then, from when they were aged around 18, a Crew Trainer. They relocated in 2019 and took up a Crew Member role with a different McDonald’s restaurant. They said that at the first McDonald’s, the ages had been very mixed, whereas at the second most employees working at night were between 14 to 16, and most during the day were 17 to 18, with some 19 or older, up to mid-to-late 20s. They stated that at both stores, each employee did the same duties in each section of the store, irrespective of their age. They then became employed by the supermarket in 2021, for a change and to be paid at a higher rate. They worked as a shop assistant in the Fruit and Veg section. They said the employees in the Fruit and Veg section were aged between 15 and 65 years old. They said aside from the Department Manager, all the employees had the same duties and did the same work. BB also gave evidence of their site visits and attendances at induction meetings in their capacity as an SDA organiser, and what they observed during those visits and meetings. BB said they also assist employees who have complaints in the workplace and talk to employees about their hours of work. They stated employees who are engaged as casual employees complained that their hours of work were being reduced or stated that they were worried that their hours would be reduced as they got older.42 [85] BCA was a minor and in year 11 at school. They worked at the deli in Coles, their first job, and had worked there since they were 15 years old. They gave evidence as to their working hours, duties, and training. They said there was no specific supervisor for the deli, and sometimes they ended up supervising others because there are employees who aren’t very competent. BCA said those employees were usually older than them. BCA said they were often the person who closed the deli. They said that in the deli, there was no difference between the tasks or duties given to employees based on their age. Everyone could do the same things, whether they were under 18 or over 21. They said they were the youngest person working in the deli, but they did the same jobs as everyone else. They said there were about 9 or 10 people working in the deli, with most of them being over 21. The youngest person apart from them was two years older, and there were a few people in their 40s or 50s. However, all of those persons’ roles and duties were the same. They said “I am aware that I get paid less than those who are over 21, even though I do the same job and have the same responsibilities as they do. This doesn't make sense to me because age doesn't affect the job we do. I think it's unfair that I get paid less simply because I'm younger.”43 41 Exhibit 19. 42 Exhibit 20. 43 Exhibit 22. [2026] FWCFB 75 30 [86] DC was a minor, in year 12 at high school. They had worked at Coles for just over two years. DC was employed on a part-time basis as a Team Member in the deli. They also gave evidence as to their working hours, duties, and training. They closed the deli when asked and had done so for the first time three months into their employment. Their role had largely not changed since they started, but they had gained some experience doing some additional duties including ‘markdowns’ on the day of product expiry and preparing platters. In 2023, DC had trained three employees, aged 18, 19, and 20. The deli had a manager who is older than 40. The manager had given DC feedback that they were good at their job and good at speaking with customers. DC said there were around seven other employees in the Deli, all Team Members. Two were 19, one was in their late 20s, three were over 30, and one was over 40. DC was the only team member under 18. DC said they were all doing the same job and completing the same tasks, though some were less nice to customers. DC said that if pay was based on performance rather than age they would be getting paid more. As to personal financial circumstances, DC was living at home and planning to go to TAFE. They were saving to buy a new computer and car.44 [87] CC was a young adult who worked at Woolworths for four years from age 14 and 9 months. They had suffered a back injury in February 2023, after which they worked six hours a week while receiving workers’ compensation. During that time, they could stand for only 30 minutes at a time before needing a break. They had since left Woolworths and were now working multiple jobs, at a tattoo studio, a radio station, and in hospitality. CC gave evidence about their work at Woolworths prior to their injury. They said that they had primarily worked in Fresh Convenience (perishable refrigerated goods such as milk and cheese), where they were often relied upon by their assistant manager to ensure CC’s coworkers were completing their tasks. They said: “Although I was not officially a supervisor, I was frequently asked to manage the team in the absence of the assistant manager, even though I was not compensated for these additional responsibilities. In Fresh Convenience, I would delegate tasks to team members and assist with any issues that arose. I was responsible for supervising up to 5 team members. There were a mix of ages in Fresh Convenience. There was a group of us who were between 18 to 23 years old, and then there was a group who were over 30 and up to 50. At just 18 years old, I found myself managing older workers while still in school.” [88] CC said that when they learned the “supervisor” role they were performing was not an official position, and they were not being compensated for it, that led to a significant decline in job satisfaction. They said that during their time at Woolworths they trained both younger and older workers. CC also said that most of the workers in the front-end department were between 18 and 21 years old, with many younger employees aged 15-16. They said the duties performed by these employees were almost identical, except for specific tasks like serving cigarettes, which required employees to be 18 or older.45 [89] CCR was minor and worked at Officeworks. They were in year 11 at school and also volunteered leading youth group activities for their church. They said the duties of other Team 44 Exhibit 23. 45 Exhibit 24. [2026] FWCFB 75 31 Members working in the same stations are mostly the same and not different for different ages. They were a level 1 Team Member. They did not know if there were different duties and responsibilities for levels 2 and 3. They knew level 4 Team Members had extra duties and responsibilities. They lived at home with their parents and did not have any expenses they were expected to pay out of their income. They saved half of it.46 [90] LC was a 21-year-old employed in two jobs, one in a retail store (a jeweller, Prouds) as a sales assistant and one as an electorate officer. They were in their third year of study at university. They had commenced working at Prouds when they were a young adult. They had KPIs and their work required a lot of product knowledge. They had felt comfortable performing the role after around one month. When they were 19 years old, they trained a new employee, engaged as a 'Christmas casual.' They taught her about customer service and explained the products to her. They supervised her work for her first four or five shifts. They had trained two other new employees since then. Other than training new employees their duties had not changed since they had commenced at age 18. They said that the store engages a Manager, an Assistant Manager, two Keyholders (who are sales assistants who can also open and close the store and can access the safe if a manager is not available), and Sales Assistants. LC said each Sales Assistant performed the same duties, regardless of age.47 [91] TOC was a forty-year-old Service Manager at Woolworths. They had been employed by Woolworths for 24 and a half years, commencing at age 16 in the fruit and vegetable department. In that time, they had worked in three Woolworths stores. They had been in a management position for the past three years and in a supervisory role for approximately ten years before that. They also had prior experience as an in-store HR representative, where they trained staff from other stores for nearly five years. They gave evidence as to their management role, the rostering process, and training new starters.48 They said:49 “In my experience, there is no difference between the duties performed by younger and older employees, apart from the legal requirement that staff under 18 cannot sell cigarettes. I base my rostering decisions on a team member's work ethic and competence rather than their age. In my experience, some younger staff members are more than capable of working independently, while some older employees require more supervision.” [92] RD was a minor. RD was a supermarket worker who had previously worked for McDonalds as a Crew Member at age 14 but had decided to look for a job in retail. They said at McDonalds the duties had not been different for workers according to age. They said the shift managers there had varied in age from 18 to 30, and the store managers and assistant managers had been aged from 30 to 40 years old. RD had then worked for two independent supermarkets, one as a Dairy Worker as a casual over Christmas, and then one as a Deli Worker. In the dairy, employees who were older than RD were performing the same role and completed the same duties. In the deli, most of the employees were RD’s age, but some were older. RD had their 46 Exhibit 25. 47 Exhibit 26. 48 Exhibit 27. 49 Ibid, [17]-[18]. [2026] FWCFB 75 32 first closing shift around two months into the job. They were in the deli section with another employee who was a year younger, aged 15. RD shadowed the 15-year-old employee as she explained the closing procedure to RD. It involved packing up the sliced meats, deep cleaning the display cabinets, wiping down the bench, sweeping and mopping the deli section, and cleaning the meat slicer. RD said that at the store, the store managers ranged from 17 to 60 years old, the checkout employees ranged from 18 to 22, and the grocery assistants ranged from 15 to 21 years old. RD said their duties were not different from the older or younger deli workers. They said that unless the employee was new in the role each employee’s standard of work was very similar. RD lived at home with their parents, spent three to four nights a week at work, and scheduled in time at the start of each week for school study and homework. They enjoyed playing golf on the weekends but found it difficult to find the time.50 [93] KD was a 34 year old Assistant Service Manager at Woolworths. They had worked for Woolworths in different roles for six years. They said they had trained employees ranging from 17 to 50 years of age and had found that younger employees often pick up technical aspects of the job, such as operating the registers, more quickly than older employees. They said, however, that the willingness to learn and the ability to perform tasks was not in their experience age- dependent; it varied from individual to individual.51 They said: 52 “In the Front End, there is a broad age range of ages, ranging from 17 to 50 years old. In my experience at Woolworths, there isn't a difference between what younger and older Team Members do when it comes to their day-to-day tasks. I find that within about a month, new employees become competent enough to work unsupervised on the front register. As team members gain more experience, they may be asked to do additional tasks such as assist with closing, or be asked to work adjacent to a new starter to assist them as they learn the job. Assessing whether a team member is ready to do this is not age based, but rather it is based on their experience and my view of their competence.” [94] JE was a minor. JE was a Customer Service Assistant at Hungry Jack’s, who had been working there around three months. They said employees over the age of 21 are mostly restaurant managers. 14- to 16-year-old workers are mostly positioned “out back,” producing burgers. Employees aged between 17 and 20 are positioned in customer service roles. JE said, “I get paid less than the older employees even though I do exactly the same as the older employees in Customer Service.” They said they were considered a 'new' employee, and staff younger than them had answered questions and demonstrated tasks to JE, because those staff had worked for Hungry Jack's for longer than JE. They lived at home with their mother and saved 15% of their income. The rest went to spending and expenses such as food. They hoped to get their driver’s licence soon so they would possibly have car and fuel expenses in the future.53 50 Exhibit 28. 51 Exhibit 29. 52 Ibid, [17]-[18]. 53 Exhibit 30. [2026] FWCFB 75 33 [95] OE was a minor and had worked for KFC since age 14. They had started in Customer Service and considered it had taken them around 2 months to be comfortable in that role. They now worked as a Kitchenhand/Cook and again had taken around two months to feel confident in that role. OE said that in customer service, the employees were generally aged from 14 to 20 years old. In the kitchen, the employees were generally aged from 15 to 25 years old. The managers were usually 19 years or older. OE said they worked the same duties just as the other employees in the kitchen. It was the same when they were working in Customer Service. But although they all did the same work the older employees were paid more. OE said experience was important at KFC because KFC had its own processes. OE had answered questions and demonstrated tasks to new staff who were older than them, because those new staff had never worked for KFC before. OE said they had worked as a supervisor for around two years. They said that when supervising, they were required to make sure younger employees, around the age of 15, adhered to the KFC health and safety standards. For example, OE made sure that employees are preparing food correctly and are not cross contaminating. They also made sure that the dishes were cleaned to the guideline standards. They said they did not organise roles and tasks based on an employee’s age. They had also been involved in closing the store. OE lived at home with their parents and saved 60% of their income. Expenses included food, fuel, going out with friends and gifts.54 [96] PF was a 22 year old, working at JB Hi-Fi. They had previously worked for KFC having commenced as a young adult, as a Level 1 Team Member. When they had started at KFC, they completed training, then 'shadowed' another employee for three or four shifts. The person PF was shadowing was 17 years old. She had worked at KFC for around one year at the time that PF shadowed her. PF said that KFC had a list of competencies that were signed off during training. They said the Store Manager told them they had completed all the competencies after two and a half weeks. They had begun opening and closing the store at around six months. At KFC, PF had been involved in helping to train new employees in the Front of House section. They trained three new employees, each of whom was in high school at the time. They said the training they had provided these employees, aged 16 to 17, was no different to the training they had received at age 19. PF said the Back of House and Middle of House employees were in their 20s, and the Front of House employees PF worked with were younger than them, a 16- year-old and a 17-year-old. PF said they all performed the same role and duties. PF said that they had asked to be trained as a shift supervisor, but there was already someone being trained. That person turned 18 just before she was appointed as a shift supervisor. PF said they wanted to work in JB Hi-Fi because of an interest in technology. PF was successful in getting a job there at age 20. They were originally employed on a casual basis but were shortly afterward appointed as a full-time Sales Assistant. PF undertook training at JB Hi-Fi. After two weeks the Store Manager said PF was ready to work on their own. They said it took about two months to become comfortable in their role at JB Hi-Fi. They also thought they had become more skilled at customer communication over time. They considered they had a better sense of customers and how to help them. PF said that while working at KFC they had been living with their parents, and did not pay any rent, or pay for bills or groceries. They were now living in a rental property with a housemate. They pay their own expenses (including rent, bills, internet, groceries, petrol). They were paying off a loan from their parents for a car.55 54 Exhibit 31. 55 Exhibit 32. [2026] FWCFB 75 34 [97] LG had worked at Big W for two months as a fifteen-year-old. They had then got a job at Woolworths at age 15, and had worked for Woolworths, in Victoria and South Australia, since. LG was 19 years old and still employed at Woolworths while also being three months into a full-time apprenticeship. They had become a supervisor at age 18, and they were the youngest supervisor at the Woolworths store where they currently worked. One supervisor was 22 years old, and the others were over 30. The work they did as a supervisor was the same as the work of supervisors who were older than them. LG supervised employees aged between 15 and 40 years old. They said in nightfill, employees were aged between 15 and 60 years old; in grocery, employees were aged between 15 and 25 years old; and in online they were aged between 17 and 55 years old. LG said employees in each of these sections are doing the same work. LG had received a wage increase after each birthday during their employment at Woolworths but did not receive extra training or extra duties. Their hours did not change either.56 [98] MG was a young adult, a Level 1 Team Member at Kmart, and a union delegate. They were in their first year of university. They had commenced working at Kmart aged 17 and had felt comfortable doing the job after their fifth or sixth shift. They had started in a section called “Door” and had then started working in “Decant.” They had to have five months off in 2023 because of a sports injury. On their return they had been rostered to work in Backfill. They had started working at the Service Desk in November 2023 and it took about a month to feel comfortable in that role. They were mostly working at the Service Desk but had also commenced being rostered to work in the Online department from August 2024. They considered that working in the Online department could be difficult, because it could get busy and they had to meet time guarantees. They considered they were comfortable working in the department after six or seven shifts but sometimes still needed help from a coworker. In 2024 they had trained three new Team Members. MG estimated that 80% of employees working on weekdays were 21 or older, including a lot who were older than 30. On weekends, they estimated 70% were aged around 16 or 17, and a further 20% aged 18 to 20. MG said they had watched younger and older employees work in each of the sections that they were trained to work in. They said Team Members working at the Door, in Decant and Service do the same work, no matter what age they are.57 [99] JG was a young adult and worked at Target as a Customer Service Assistant. They had commenced at age 17. They were also in their second year of university. They had commenced at the self-serve registers and felt comfortable doing the role after two weeks. They were then trained to work in Fill, then Online fulfilment, feeling comfortable with the latter after two months. JG had stayed in Online since with occasional shifts in Fill. Since around January 2023 they had helped train five new employees in Online. New processes had been introduced in both of those sections since JG had commenced, making them both more efficient. Aside from those efficiency improvements, JG’s role and duties had not changed since the beginning of their employment in 2021. JG received a pay increase on each birthday but there was no role change or extra training. JG said there were two part-time employees working in the Online section, both over 30 years old. There were six casual employees working in the Online section; one was 17, and the rest were around 20 years old. Each was engaged as a Customer Service Assistant. When JG had worked at the registers, around three Customer Service Assistants were 56 Exhibit 33. 57 Exhibit 34. [2026] FWCFB 75 35 over 30 years old. The remaining Customer Service Assistants were aged between 16 and 18 years old. JG said Fill was usually done during the day. Most employees who worked in Fill were older than 21 years old.58 JG said:59 “I've seen younger people and older people work in Fill, Online and on the registers. The work that Customer Service Assistants do in these roles is the same for people of any age. The work that I'm doing at 20 years old in each role is the same as the work that I was doing at 17 and 18 years old.” [100] JG lived at home with their parents. They paid $50 per week in rent. Other expenses included their phone plan, gym membership, petrol, and streaming subscriptions. [101] JH was a young adult Coles employee. JH had worked for Coles, in two different stores since age 16. JH had been employed in the Dairy section working in Nightfill and had worked in Nightfill consistently throughout. JH also had another job at the Good Guys and was in their second year of university. JH said when they had commenced employment in 2021, they had been the youngest employee in the Dairy department. One employee had been 18 years old. The other Team Members had been 21 years old or older. JH had trained around ten new Team Members in Nightfill; the first had been in around December 2022. JH said two of them had been two years younger than JH and the rest had been between one or two years old than JH, at the time of the training. JH said each Team Member working in Nightfill in the Dairy department did the same role and considered it unfair that they had been getting paid less than people who were older than JH but did not do as much work and had not been there as long. JH said they got a pay increase each year on their birthday, but their role had not changed. At the Good Guys, JH said they had felt comfortable working with the other staff at the Good Guys straightaway and felt comfortable performing their role after around two months but they had become better over time. They had learned all about the products. They considered a salesperson needs to know about a product to be able to convince people to buy it. They said they had also become better at offering product installation and other extras to customers. JH was the youngest salesperson at the store. They said they had not worked many shifts at Coles since getting the job at the Good Guys.60 [102] CH was a minor who had commenced employment at Woolworths at age 15 and had worked for Woolworths ever since. They had left school at a young age.61 They said:62 “My average weekly earnings fluctuates according to how many shifts I get given each week. For example, in one week (a fortnight) ago I earned $329.81, the week before that I earned $133.88, and the week before that was $272.09. I don't have any other sources of income. This is my only job. 58 Exhibit 35. 59 Ibid, [26]. 60 Exhibit 36. 61 Exhibit 37. 62 Ibid, [43]-[47]. [2026] FWCFB 75 36 I live at home, but I pay for all my food, my phone and fuel, and contribute to household utilities. I live paycheck to paycheck. Some weeks I can only afford to eat instant noodles. I almost never have any money left over after purchasing food for the week. If I do, I use it to buy better food the week after. I get a staff discount at Woolworths, but it is so minimal it hardly makes a difference. I can't afford to do things that I used to do, and I cannot really afford to keep up with my friends. I used to have a large group of friends. I now only have […] two or three who are willing to just hang out, without need[ing] to spend much. I've lost a lot of my social life because I am either working, or I cannot afford to do the activities my friends want to do. When I am not at work, I am mostly at home.” [103] CH was a casual employee whose hours and earnings fluctuated. They worked across a number of different sections, though they rarely worked on the registers. They had started on nightfill but had asked to be transferred into day work. They were available for shifts between 6 am and 3 pm. For the past three months they had been performing temperature checks on all the refrigerators and freezers in the Groceries and Fresh Convenience departments, a job usually given to managers or more experienced employees (by reference to work experience and competency, not age). CH had also, recently, been asked to start supervising new starters. CH said they would not describe this as a formal supervisory role. But a few weeks ago, they had a man start in their department who had transferred from the cleaning department. He was familiar with the store but did not know how to stack shelves or perform other duties in the Fresh Convenience department. CH and the man worked side by side for two days, as CH gave him advice on how to stack the shelves, and answered his questions, based on CH’s experience. CH did not know how old the man was but would estimate he was in his fifties. CH said they had also done this on three other occasions, with new starters in the Groceries department. The evidence of CH was that all of those workers were older than CH and had all been over 21. CH said they were the youngest employee at their store working day shifts mid-week and was still one of the youngest working outside school hours. They said the duties they performed were exactly the same as the duties their colleagues performed, regardless of age. CH said in their experience, whether a worker was under 18, over 21 or in their 50s made no difference in terms of the duties the worker was allocated or the duties they were permitted to perform. CH said the only people who performed duties different to theirs were managers. They said managers tended to be older in age. [104] YH was a young adult Merchandise Team Member at Big W. They had previously been employed at KFC from around age 13, in mid-2020, for a year and a half. In mid-2021, aged 14, they started training new employees at the request of the Store Manager and Shift Supervisors. By the time they left they had trained ten new employees aged between 13 and 16. At age 15, during their final year at KFC, on a few occasions the managers asked YH to oversee the “drive-thru” and front counter sections. This involved checking that tasks like cleaning were done correctly, staff were meeting hygiene requirements, and making sure orders got out on time. YH said this was a similar role to the role that supervisors performed. JH said most of the Team Members at KFC were 16 or younger. There were also around ten employees between 18 and late-20s. They said all of the Team Members performed the same duties save that employees under 14 were not allowed to operate the deep fryers. Otherwise, employees’ duties [2026] FWCFB 75 37 did not change with age. YH said they felt quite stressed working at KFC and that they were not enjoying the work. They commenced working at Big W in April 2022, aged 16. They were casual for two years then became part-time. They remained a Level 1 employee. They started in Fill, moved to “Recovery,” then Checkout, then Party. At age 18 they were given extra duties when working in Party. It took around 2 months for them to feel comfortable in their role. They had trained four people in the Party section; they had commenced training others at age 17. YH said the employees who were 23 years or older in their workplace do not have roles and duties different from theirs. The other Team Members had told YH what their job entailed, and YH had worked with some of them. They were all doing the same thing; however, YH also had some additional responsibilities compared with some of the people older than them. YH said they were the only person their age with responsibility for consumables orders. They also believed they were the only person aside from the Managers responsible for cashing up registers. YH lived with their mother and did not pay rent. They had expenses including car loan repayments, food, and petrol. Their mother was injured and unable to work so YH had been spending an extra $50 per week on groceries. YH said they only rarely bought new things. They were planning on starting university the following year.63 [105] SH was in high school. They had worked at Red Rooster for a year from age 13. It took about a month to feel comfortable in the role. SH had started their current job at K Hub (a small format Kmart store) at age 15. They said there were around 15 to 18 employees at K Hub, not including managers. There were seven employees under 18 years old. The youngest was 14 years old. One employee was aged between 18 and 21 years old. There were around another seven employees who were older than 21 years old. The oldest is 50 years old. Aside from the Managers, SH’s duties in the roles they described were the same as other employees, including employees over 21 years old.64 [106] IH was a young adult employee of Kmart, who had previously worked in fast food. They had started working at age 16. They said that at their first fast food job, the front of house and back of house employees were generally aged from 14 to 40, shift managers were aged 18 to 30, and store managers and assistant managers were aged 30 to 40. They said there were no differences in duties according to age. At IH’s second fast food job, which they started at age 17, they worked in front of house. They were one of the youngest employees. There were no differences in duties by age. They then went to work at Kmart, also aged 17. They started working in checkout, presentation, service, front door, and fitting rooms. Around a year later they changed role and became a sequence team member. They said all new team members started in presentation and checkouts regardless of their age. IH lived at home with their parents.65 [107] AI was a young adult Team Member at Woolworths, who had been working for Woolworths since age 16, at three different stores. They were also a university student, in their second year. They said that there was no difference in the work that employees were doing, whether they were under 18, 18 to 20, or over 20. They said that when they were under eighteen, they had performed the same tasks as older people but did more heavy lifting and moving 63 Exhibit 38. 64 Exhibit 39. 65 Exhibit 39. [2026] FWCFB 75 38 trolleys than older employees. They said they were performing the same tasks at Woolworths as they had performed when they were 16 years old.66 [108] KJ was a minor and a “Crew Coach” at McDonalds. They had worked for McDonalds from age 14 and had an intervening stint at Red Rooster. They had finished school and were planning to go to university. KJ had become a Crew Coach at age 15, a role they did for several months before going to Red Rooster. When they returned to McDonalds they did so as a Crew Member but were shortly after promoted to Crew Coach. They said that as a Crew Coach they trained new Crew on what to do at each station in the store. KJ did so over one or two shifts, with the Crew then left by themselves, but KJ still supervised them and coached them while also doing KJ’s own duties at the station KJ was working at. As a crew Coach, KJ still had the duties of a Crew Member which included making burgers, cooking food, taking orders, packing orders, providing orders to customers, making drinks in the café, washing dishes, and cleaning stations. In addition to training new Crew Members, KJ also made sure the more experienced Crew were following procedures and recorded any hazards in a logbook. KJ was the only Crew Coach at their restaurant who knew how to do inductions for new employees. In August 2024 KJ created a handbook that provided guidance on how to do an induction. This was done in their own time and took approximately six hours to create. KJ also organised breaks for the Crew. KJ said on a busy shift there were approximately 20 employees working, which comprised of 2 Managers and two to three Crew Coaches. KJ said the duties of Crew Members did not differ according to age. They said their duties as a Crew Coach did not differ from other Crew Coaches save that they knew how to do the inductions.67 [109] KJ also gave evidence regarding their time at Red Rooster. They said the duties of Crew Member at Red Rooster were not different for different ages, and there were no restrictions of duties for different ages. As to their personal circumstances, KJ lived at home with their parents. Their current expenses included car registration, fuel and insurance, their phone bill, subscriptions, and union fees. They said they would pay board the following year. They said they were saving up for a car service as their car was on its last legs. They saved money and did not have much time for their hobbies because of work. [110] JKA was a year ten student who worked for Kmart in Presentation, in Kids Clothing, and Ladies’ Clothing. They said they followed a method to their work. They started by cleaning the display table. Then they put clothes on hangers. Then they fill a trolley with items that have been moved and take them back to where they belong. If they finish all of their work, they help out other employees in their sections. JKA said they felt comfortable doing the work after five or six shifts. JKA also worked at Checkout. They said the work each of the employees are doing in Checkout is the same. They said that sometimes customers wanted to pay with a voucher, or there was a problem with the price. When that happened JKA would call another employee to help them, because they did not know how to do this task. But, JKA said, that was the only difference between their work and the other employees’ work in Checkout. JKA lived at home with their parents and made about $50 per week after tax.68 66 Exhibit 41. 67 Exhibit 42. 68 Exhibit 43. [2026] FWCFB 75 39 [111] JK was a young adult who was a casual Service Supervisor at Coles, and who was also currently employed with Marist Schools Australia as a regional assistant for youth ministry. They had started working at Coles aged 16. They had started as a Fresh Team Member, stocking the fruit and vegetable area, marking down items that were out of date, ticketing, cutting fresh watermelon and undertaking some duties in the Deli, including cooking rotisserie chickens. JK had started doing all of these duties within the first two weeks of their employment. A few months into the job they were trained to become a Skilled Team Member. A Skilled Team Member was cross trained in different departments. They were also trained in the Coles Online section. They continued to work in Fresh Produce after this training but if an employee called in sick, they were rostered to work in Service or Online. After Coles opened a new store in November 2022, JK transferred there, aged 17. They received training in the new Assisted Checkout machines. Upon moving stores JK became a Service Team Member. JK has worked in that team ever since. They remained a Skilled Team Member during this time and continued to work in other departments on occasion. When they turned 18 and were able to sell cigarettes, JK became a Service Supervisor, but their rate of pay was not increased to reflect the increase in responsibility. JK’s responsibilities as a Service Supervisor included making sure team members went on breaks, supervising four team members performing their roles, closing the store, customer refunds and returns, selling cigarettes, and counting and declaring money. They said that since becoming a Service Supervisor they had trained three new employees. JK lived at home with their parents.69 [112] CK was a casual Team Member at McDonalds and a university student. They had started working at McDonalds at age 14. Around 12 months after starting, they started training other employees. They also started working from 7 am on Saturdays which involved an added responsibility of making sure the fridges and condiments were properly stocked for the day. Aside from these additional duties their role didn’t change during their employment at McDonalds. They then got a job at Kmart, starting at age 16 and then working at two different stores because of relocation for university. They said it took them a couple of months to feel comfortable in their job at Kmart. They said Team Members who worked in Refresh, Checkout or Door with them performed the same duties regardless of age, but some Team Members who had more experience were able to do a little bit more. For example, in Refresh, experienced Team Members could complete more areas in a shift. On Door, a more experienced staff member is able to tidy up around the checkout area while they work. But this was based on experience not age. CK had never supervised anyone at Kmart.70 [113] TL was a minor who had two jobs, one in a supermarket and one at Kmart. They had previously worked at a video arcade, commencing aged 13 and 10 months and staying for around eighteen months. They commenced their job at the supermarket at age 14 and were employed as a Customer Service Assistant. They said they had felt comfortable in the role after about 2 or 3 shifts. They were not in a position of responsibility and had not trained other employees, though other employees have asked them for help and they have given it. They said the duties of employees in the front area did not differ by age. They said supervisors had additional duties, and employees aged 17 may be introduced to training to become a supervisor if they chose. They said there were currently two employees aged 17 who were training to become supervisors. They said the managers did the stock order for cigarettes, and scheduling 69 Exhibit 44. 70 Exhibit 45. [2026] FWCFB 75 40 for rosters. They said the managers were 25 years and older. They had commenced at Kmart very recently when they made their statement and said they had done so because they were not getting rostered for many hours at the supermarket. They worked at Kmart on Saturdays, during the day, and could be rostered on to work Monday, Wednesday, or Thursday evenings. From what they could tell so far most of the employees at the Kmart were Team Members, and their duties were not different based on age. They lived at home with their parents and had taken the second job so they would be able to pay car registration.71 [114] SL was a young adult Coles Service Supervisor. They were also working part-time in an administrative role at a psychology clinic. SL was also a university student in their second year of study. They had commenced at Coles at age 17, as a Level 1 Store Team Member. By the time of the statement SL was a Level 4 Team Member, who usually worked around three hours per week. SL had been a supervisor for 12 months. They said they supervised Team Members aged 15 to 50, with around 30% being under 18, and around 40% being between 18 and 25. They said that when organising where people would work on a shift, they focussed on convenience. They gave the example that if an employee working on register is finishing their shift, and a second employee is starting at the same time, they directed the second employee to work on the register. They said they also rostered Team Members into roles based on their own preferences. They said they did not direct people to work in a specific role because of their age. Some of the older workers preferred working on registers. SL said they oversaw the work that each Team Member did in the Service department and that they had worked in each of the roles they now supervised. They said that each Team Member performed the same duties in each role. They said young employees aged 15 and above performed the same duties as older workers. SL said that in May 2024 the store had hired a new Service Manager who decided casual workers would not be rostered on weekends, and casuals were now complaining they were not getting enough shifts. SL had not had a shift in three weeks prior to making their statement. They had asked to become part-time and were waiting for that to be approved. SL lived at home with their mother and brother. SL said their weekly expenses were mostly travel- related, listing petrol, public transport, and food. They were saving for travel, a car, and the future.72 [115] SLU was a minor who was a Crew Member at McDonalds, who had previously worked at a “drive thru bakery” from age 14. They had been the youngest employee at the bakery and had felt competent to perform their role there after four to six months. They had the same duties as the other bakery workers except that they did not make coffee. SLU commenced at McDonalds aged 15 as a casual employee. They were engaged as a Team Member which involved performing work in multiple roles: making fries, working on the front counter, and, in “drive thru,” Headset, Cash, Run, and Present. Headset was the first person the customer speaks to at the drive thru window and involved taking the order and entering it into a screen. Cash was the payment window. Run involved putting all of the customers' food in the bag for them to collect. Present is where the food is handed to the customer. SLU said they felt comfortable in one or two months in all of these roles, and that Headset was the most difficult to learn. After leaving high school at age 16 SLU became a part-time employee at McDonalds, working 25 hours a week. Their role did not change. At age 17 they had been trained to work in the kitchen and had been working in the kitchen making burgers since. SLU said they had trained other 71 Exhibit 46. 72 Exhibit 47. [2026] FWCFB 75 41 employees in different roles in the store. These were not new Employees but employees who had been working for a while and were taking on a new role. They had trained seven or eight people aged between 15 and 17. SLU said employees at McDonalds were aged between 15 and 25 years old, and most were between 15 and 17. They said there were Crew Coaches who were 15 or 16 years old, and one Area Leader was 17 years old. They said during the day employees were mostly older, and in the evenings, employees were nearly all 17 or younger. SLU said each role at McDonald's was the same role for young employees and old employees. However, the adult employees who worked during day shift did not have to complete as much work as younger people who worked in the evenings. This was because there were not as many staff rostered to work in the evenings. For example, in drive thru, a young employee at night had to complete the tasks of both Present and Run for the drive thru. An adult employee only had to do Run or Present, not both. SLU said that on one shift in the evening, they had worked on Front Counter, Drive Thru, Present and Café alone for 30 minutes. They said there would be an adult for each of these roles in the morning. SLU lived with their mother and was not paying rent.73 [116] EL was a young adult café employee with a recently-completed Certificate IV in Patisserie from the William Angliss Institute. They had obtained their certificate II two years earlier. They had previously worked for McDonalds, at two restaurants. EL had commenced with McDonalds at age 15 as a Level 1 Casual Crew Member. After around a year EL was asked to work in the café section at McDonalds. After doing two training sessions they asked for a third as they did not consider the two to be sufficient. They felt comfortable working in the café section after around two months. When a new franchisee took over the restaurant, EL decided to move to a different restaurant still operated by the former franchisees, whom EL liked. The new restaurant was co-located with a service station and had a much larger back-of- house section, and did not have table service. Aside from these differences the work was the same. Soon after moving EL was trained to work in the kitchen, completing three or four training shifts, where other Crew Members trained EL. EL had also trained an employee at their first restaurant, and two employees at their second. EL said that they also supervised their sections when they were the most experienced employee in that section, including employees who were older than 21. In 2023, EL joined the McDonald’s ‘Safety Squad,’ which involved keeping a log of any safety hazards around the store, having two daily safety conversations with team members on shift, and initiating safety conversations with anyone not following procedures (for example, by failing to use appropriate personal protective equipment, or not setting up ‘wet floor’ signage). EL estimated 70% of Crew Members were 15 to 18 years old. Some of the remainders were over 21. These proportions were the same across both restaurants. Crew Members older and younger than EL were doing the same tasks they were. When new owners took over EL started getting fewer shifts, so they decided to look for a new job. They commenced working with a new employer, which operated a drive thru café. EL’s job title at the new employer was Barista all-rounder, and they were employed under the Fast Food Industry Award and paid junior rates. Their new job did not generally involve supervising other workers; they had done so only once. They were comfortable in the new job immediately because of their experience at McDonalds. They said there were around 25 employees at the new employer, and most were older than EL. Everyone at the new workplace had the same 73 Exhibit 49. [2026] FWCFB 75 42 duties regardless of age. EL lived with their parents and did not pay rent or bills. EL paid car expenses, contributed to groceries, and paid for pets’ expenses.74 [117] BM was a minor who was a Bakery Manager at a Cornetts-IGA store in a regional town. They had worked at two other Cornetts-IGA stores, in a different town, commencing at age 14. They had worked at a petrol station before that. BM chose to relocate to be closer to a Rugby League competition, and transferred to the current store at that time, aged 16. They had become a Bakery Manager at 17, working full-time. Though they are referred to as Bakery Manager at the store, including by the Store Manager, they said their classification was as a Level 3 bakery supervisor. BM supervised three employees in the Bakery, a 16-year-old, a 27-year-old, and a 29-year-old. The work those employees performed was the same. BM assigned work to each employee based on what needed to be done. They did not differentiate by age. BM had worked in most sections of the store and had seen the work that Team Members were performing in each section. BM said the work the older employees performed was no different to the work that employees aged 20 and under performed. BM lived with their aunt and uncle and did not pay rent. They were saving to buy a car, and for a rugby league tour of England, having been selected to play for an Australian team.75 [118] MM was a young high school student. MM was in their first job, as a Customer Service Assistant at Target. They performed three roles: Cleaning, Decant, and Door. Cleaning was also referred to as being ‘on the floor’ and involved walking around the floor and tidying the store, returning things to where they belong, making sure the clothes are sized in order on the racks, and spreading out items properly so they look nice. If there’s time it also involves folding clothes. It took MM two months to feel confident in cleaning. By that time, they had worked in every section of the store. MM said they were good at what they did and knew the store like the back of their hand. Decant involved organising stock once it had been delivered. It required a lot of walking and sometimes MM found themselves doing a mild jog to get everything in place in time. They were competent in Decant. They could work in that section without their managers having to worry about them falling behind. MM had just started the Door role and had done about five shifts in it. They check receipts and call security if needed. They felt confident doing the Door role in about half an hour. Their only direct feedback had been positive feedback. MM said in Decant the other employees were generally aged between 15 to 25. In cleaning, most of the other employees are 17 and 18, there were some going to university, and there was a lovely lady who worked that shift who was in her 30s. As to the Door, the other employees are older than 20, and there was an older lady who was over 50. MM said that she did not know exactly how long the older lady had been working at Target, but she had been employed long before MM had started. She was really good at her job and really thorough. She was able to check on customers but in a way that made them feel like they were not being targeted. MM thought that besides this older lady, MM was working at the same standard as everyone else who was working on the Door.76 MM said:77 “My duties in each of these roles does not differ from the older employees, regardless of how old they are. Unless the employee is new in the role, each employee's standard 74 Exhibit 50. 75 Exhibit 51. 76 Exhibit 52. 77 Ibid, [35]. [2026] FWCFB 75 43 of work is very similar. We do the same work, and the same amount of work, at the same time. The only difference is that I don't get paid as much.” [119] MM said a few weeks ago a lot of new employees had started. Most were aged 15 to 18, but some were in university and older than 20. MM said when those new people started, they were not as effective in doing their role as MM, because they were new. Even if they had experience in other jobs, they hadn't worked in a Target before and did not know the store. The new staff asked MM questions and asked for advice on how to do their job. MM said they had not worked as a supervisor or acted in a role, and they had not been a buddy to others quite yet. However, MM had worked with one older employee, over 40, on one of her first shifts without a buddy. They were working in the Beauty section and MM gave her a lot of advice on what to do. MM lived at home with their father and grandmother. MM’s grandmother set a benchmark of 75% of MM’s weekly income going to savings. MM could do what they wanted with the other 25% but they had to buy their own makeup and clothes. MM was saving up to buy their own MacBook next year and wanted to save for a car and for university. [120] AM was a young adult and worked at Kmart. They had previously worked at McDonald’s, Hungry Jacks, and a different Kmart store. They had started at McDonalds as a casual aged 14 and 9 months and had felt confident after two weeks. Around two-thirds of the employees at the McDonalds were aged 14 to 16 years old. The rest were aged from 17 to 20 years old. The work AM was doing as a 14- and 15-year-old was the same work that older employees did when they performed the same roles. In late 2019, a staff member from McDonald’s asked AM to come in for a shift. AM was on holiday interstate with their family and could not come in. They said they did not get many shifts after that discussion. They decided to apply for a job at Hungry Jacks. They started there aged 15, also as a casual. The employees at Hungry Jack's were aged between 14 and 18 years old. The Manager prepared a shift planner for each shift. The shift planner was posted next to the drink fountain and listed the area where each employee would be rostered to work, and their break time. That was how AM knew what they were doing on a given shift. The roles and duties they performed were the same as those of other employees, who were eighteen. [121] AM’s grandmother worked at Kmart and recommended that AM apply for a job there. AM “did not want to work in fast food forever” and started working at Kmart aged 16. From the beginning of AM’s employment at Kmart, AM started work at Kmart at 4.00pm and worked until 7.00 pm. AM then walked from Kmart to Hungry Jack's and worked there from 7.00pm until midnight. This continued for a few months, and AM then left Hungry Jack’s and continued working at Kmart. AM said they felt confident working at Kmart from the start of their employment. AM said they had known a lot of the staff most of their life, so they knew if they made a mistake, there would be someone to talk to, or to fix it. After around two shifts in each role, they felt comfortable. They said the managers were also supportive and told them they were doing a good job. AM had started university but decided not to continue with it. They had then started a full-time traineeship with an organisation, but arranged to work a shift a month at Kmart so they would continue to be considered a current employee. AM completed six months of the traineeship and says the managers at the organisation encouraged them to move to a regional location to keep working for them. AM and their boyfriend arranged to relocate, and AM’s boyfriend secured employment there, AM was subsequently advised there was no longer a position available for them with the organisation there. They decided to move to Whyalla anyway and commenced employment in Kmart at that regional location in June 2024. [2026] FWCFB 75 44 AM had difficult personal circumstances. AM’s mother had been unemployed from 2014. AM’s mother married in 2018, and AM’s stepfather was employed but his income was not high, and the household still received government income support. As a minor AM had not contributed to the rent but needed to work to make money for anything their mother could not pay for including food and petrol, and to save to buy a car. From age 18 AM paid board. At the time of the statement AM lived alone in a semi-detached house in the regional location and received income support (Rent Assistance and JobSeeker). AM was working around eight hours per week at Kmart and had asked for more shifts. AM was also applying for other jobs.78 [122] SM was employed by the SDA and was also a university student. They had been employed at the SDA for three years and had previously worked at McDonalds. They had started at McDonalds at age 15, in 2017, while in high school. When SM commenced their employment at McDonalds, they were rostered to work in the kitchen. They prepared food, made burgers, and cleaned the kitchen. SM said they felt anxious in this role, and it took them around five months before they felt they were performing their duties adequately. SM became a Crew Trainer at age 16. As a Crew Trainer SM trained more than forty new employees, aged between 14 and 17 years old. SM said McDonalds was a Registered Training Organisation and SM received a Certificate II from McDonalds in 2018. SM said that during their employment at McDonald's, they were trained to work in new areas of the store and took on more responsibilities as a Crew Trainer. But otherwise, the roles and duties they performed, in kitchen, service, drive thru and café did not change. SM took up employment with the SDA as a young adult and resigned from McDonalds a few months later. SM’s statement went to what they had observed at retail and fast food stores, in their capacity as a union organiser.79 [123] EM was a casual bookseller in their mid-twenties, who was also a full-time university student. They had started working for Kmart ten years earlier and had worked there for four and a half years. EM said they did not observe any significant differences, based on age, in the responsibilities allocated at the first Kmart store they worked at. At the second Kmart they worked at, they said the duties assigned to younger and older employees were generally the same. However, EM noticed that younger employees, including EM, were often asked to assist with technology-based tasks, such as troubleshooting the self-serve checkout machines. EM said this was due to younger staff being more familiar with the technology than some of the older employees. EM then worked for Officeworks for almost four years, before taking up work in a bookstore. At age 23 they had been promoted to a coordinator role at Officeworks, and in that role was responsible for assisting the Store Business Manager with rostering. This involved planning shift schedules while ensuring that the store's wage budget was not exceeded. The wage budget influenced the decision to allocate more shifts to junior employees. But age was not a factor in determining responsibilities. Staff of all ages performed similar duties, and the allocation of tasks was primarily based on experience and competence. The tasks EM performed as a Coordinator were no different from those their older colleagues performed when they were in similar roles. During EM’s time as a Coordinator, they supervised employees of varying ages, including junior employees and employees who were older than EM. They said that although age did not affect the allocation of duties, junior employees were often preferenced in the hiring process because they were employed on lower rates and could therefore help to meet 78 Exhibit 53. 79 Exhibit 54. [2026] FWCFB 75 45 the store's wage budget. The performance expectations, however, remained the same for both junior and adult staff.80 [124] EM said that when they were working at Kmart as an 18-year-old they earned a junior wage which was around $16 per hour. They said that they found it difficult to cover all their expenses while studying full time at university. They said their wage barely covered their rent, groceries, and other necessities, and they were left with very little for social activities or savings. They dropped out of university after six months because they could not make ends meet while working 15-20 hours per week on junior rates. They did not want to compromise the time they had to study by working longer hours. They said that in contrast when they were working at Officeworks at age 21 their financial situation improved significantly. They said that by this time they were earning an adult wage of around $35 per hour and was able to work a similar number of hours per week, 15-20. The difference in the hourly rate allowed them to cover their living expenses comfortably, with money left over for savings and social activities. They said they were no longer under constant financial strain and could focus more on studies without worrying about how they could make ends meet. EM said their current job, where they also earn an adult wage, “continues to provide me with the financial stability I need to support myself while studying full-time.” [125] JM was a 23 year old full-time SDA Organiser who had previously worked in fast food. They had started at KFC at age 14, at McDonald’s at age 15, Hungry Jack’s at age 16, and Subway at age 19. They had been employed by the SDA for two years. At Subway they had been involved in rostering. They said each employee's responsibilities were the same. There was no 'senior sandwich artist.' They were provided with forecasted sales figures and the franchisee told them that rostered labour costs for each day had to amount to under 24% of forecasted sales figures. JM tried to roster workers aged 14 to 16 years old whenever they could, because the younger workers received a lower rate of pay. This kept labour costs as low as possible. JM said aside from labour costs, they would roster an employee to work based on their proficiency. For example, if an employee was really good at closing the store, JM would roster them to work closing shifts.81 JM said:82 “Age alone was not a factor in an employee becoming an effective team member. But time was a key factor in employees becoming proficient. The longer an employee had been in the job, the stronger they became as a team member. Another factor was determination. Some employees needed extra shifts because they needed the money, so they worked very hard.” [126] JM said they inducted and trained new employees aged 12 years old to their late 20s. JM said they trained and supervised all employees the same way. JM also provided evidence about what SDA members had told them during store visits. [127] DM was a 19-year-old Union Representative at the SDA, and a university student. Until a few months previously DM had worked for KFC. DM had become a Shift Supervisor at KFC at 18. Their duties in that role included managing staff, counting money, setting and rebalancing 80 Exhibit 56. 81 Exhibit 57. 82 Ibid, [73]. [2026] FWCFB 75 46 the register, managing the safe and counting money. DM made sure they had enough stock, placed orders for more, and received stock into the store. They liaised with nearby stores to make sure everyone had enough product and arranged to transport stock across if necessary. DM said they were comfortable in the role after two months but became more efficient over time. DM relocated in February 2024 and worked at a different KFC store from that time, exclusively as a shift supervisor. The systems of work were the same, save that the new store did not serve potato and rostered only one person on for opening, not three. DM supervised employees who were older than them, up to age 23 or 24, at both stores. As a supervisor DM directed employees as to what duties they had to perform. DM managed other employees and supervised their work. At both KFC stores there was no difference in the duties that young people were completing as compared to older people. The work was the same. DM did not allocate work based on age but based on the Team Member’s ability.83 [128] MO was a young adult Level 1 Team Member at Woolworths, and a university student. They worked around 15 hours a week and said they were listed as a Grocery/Nightfill Team Member, a Fresh Convenience Team Member, and a Grocery Team Member on an app in use at Woolworths. MO said that after two months they had felt comfortable working in Nightfill and stacking the drinks aisles. It took them about six months to feel comfortable working in the freezer section. MO said that the work that the other team members performed including the older and more experienced employees was the same as the work that MO completed however MO said they were faster at completing their work than the older employees. They said they moved faster and were more efficient at lifting and stacking heavier items. MO had not worked as a supervisor. 3 new employees, aged 27, 34 and 50, had shadowed MO. MO had also helped other employees learn how to use the bale press. MO said they were shocked to find out how much more a fellow Team Member in Nightfill, who was 34 and had been working there only two months, was getting paid. MO was doing the exact same job and was much more experienced. MO said they understood older workers were paid more which was why they waited until age 17 to get a job. MO did not want to work for $15 an hour when they were 15 or 16 as they did not think it was worth it. MO lived with their family. Their main expense was fuel. They were saving to buy a house. They said working at Woolworths could put a lot of pressure on them in relation to meeting deadlines for university work.84 [129] JP was a Coles employee aged over 20, who was also studying full time at university. JP had recently taken on another job as an optical dispenser at National Pharmacies working 10 to 15 hours per week. They also did some private tutoring, a couple of times a week. JP had commenced at Coles at age 15. They were working 5 hours a week (1 shift) as they were focusing on university. Originally, they started in the front end, but they had been in the deli for the past four years. They had taken on training responsibilities and regularly trained both younger and older workers as well as acting as a buddy for new staff during their first shift. They trained workers older and younger than them. JP said older workers sometimes had preconceived notions about working with younger colleagues and assumed they knew better despite having less experience. The duties performed by employees aged 15 and 21 were “almost identical” to those of older workers and the training was therefore the same. JP 83 Exhibit 58. 84 Exhibit 60. [2026] FWCFB 75 47 contributed to household expenses, paid for fuel and parking, and paid for university fees and textbooks. JP also tried to save part of their income each week.85 [130] JPH was a young adult retail worker who had previously been employed by Target and now worked at The Reject Shop. They had commenced at the latter at age 16 when the Target store had closed down. They had recently signed a contract to become a part-time supervisor and now worked up to 30 hours a week. However, they had taken on supervisory responsibilities prior to becoming a part-time supervisor when they were still a casual sales assistant. JPH said the manager had given them these additional responsibilities because they had demonstrated that they were capable of doing more. JPH said it had taken them about a month to become comfortable doing their initial role at the Reject Shop. Knowing the manager and having had experience at Target made the transition less stressful. JPH said they worked with people older and younger than them, ranging from 16 to 64. In organising roles and tasks for employees JPH said age did not really matter, it depended on whether the employee had the ability to do a task. However, employees under 18 years old had different responsibilities. For example if a customer asked an under 18-year-old to do a refund the employee would usually know how to process that, however if a customer was asking to purchase a certain product from another shop, or to see how many of the stock there is left in the store or other stores, JPH would have to do this as it was not part of the training for the under 18s. JPH said half to three quarters of their income went to bills which they halved with their partner. Around 25% went to food and other necessities.86 [131] BQ was a young adult KFC employee studying a bridging course to go to university. BQ also taught martial arts. BQ had worked for KFC for two years. BQ said the duties at the KFC were not different for different ages save that employees under 15 are not allowed to touch the fryers or anything hot, and that employees over 18 are treated as senior staff members and have a responsibility to look after everyone on the shift. Once BQ turned 18 the manager said BQ was now a senior staff member, and was expected to provide direction, be a good role model for, and provide training to junior employees, when required. “Senior staff member” was not a formal title. BQ had trained approximately ten junior or new employees, between 14 to 16 years old. BQ lived at home with their parents.87 [132] AT was a minor who was a sales associate at a jewellery store working 24 to 28 hours per week. They had initially been uncomfortable with customer service but started feeling more comfortable after about one or two months of work. They were the youngest employee at the store. The majority were in their mid to late 20s. The oldest was about 50. There was no difference between roles and duties according to age. While AT was the youngest employee, they were more experienced than some of the newer staff. The new staff were often older, but AT was more experienced so they showed the new staff what to do if they had questions. AT lived at home with their parents and did not currently pay any board or rent but expected to start paying rent in about a year’s time. AT’s older sister lived with them and currently paid board.88 85 Exhibit 61. 86 Exhibit 62. 87 Exhibit 63. 88 Exhibit 64. [2026] FWCFB 75 48 [133] JT was a Coles employee who was a minor, at high school completing year 12. JT was employed in the deli section mainly serving customers, with the role also involving a lot of cleaning. The deli team cooked chickens four times a day. JT put the chickens on racks, seasoned them, cooked them for about an hour, took them out of the oven, and put them in bags. JT felt comfortable working in the deli role after two or three weeks. It took them around four or five months to get comfortable closing the deli. There were eight people on the Deli team including JT. The newest employee was 16 years old. One was 21, another was 19 and the other four were in their 30s and 40s. Regardless of age the team members were doing the same role, and the work JT was doing was no different from what all of the other staff did. JT had lived with their father and little brother until recently. Their father had become unemployed several months previously, and they had had to move house. At that point JT had agreed to pay rent as well as a contribution towards fuel and groceries. This arrangement had lasted until very recently when JT's father and little brother had moved interstate, but JT had decided to stay behind. Since then, JT had been staying with a friend. JT had offered to contribute to the rent, but the friend had not accepted the offer. JT had not been able to save very much money while living with their father. They were hoping to do an apprenticeship after finishing year 12.89 [134] AW was a young adult who had been employed at an IGA grocery store from age 17 to 19 and had been working at David Jones since. At the IGA, duties differed by experience, not age. The more experience, the more responsibility. For example, if a worker was rostered to work until closing, they would be responsible for counting the cash registers. AW assisted in training around four new employees while at the IGA. At David Jones, AW was a Sales Professional in Men’s Wear. It had taken them one and a half months to feel confident in the role. AW worked with employees aged from 17 to 60 in the department. They said more responsibility was placed on the permanent roles than on casuals as they spent more time on the shop floor. AW said there were older Sales Professionals, but they all worked the same and did the same job. AW said they had worked as a supervisor and had been a ‘buddy’ to other employees. AW lived at home with their parents and saved 65% of their fortnightly income.90 [135] MWH was a minor and a KFC employee who was currently in high school. They were employed as a team member, and it was their first job. They had commenced at age 14 working only in customer service. It had taken them about four shifts to feel comfortable working in customer service. They had recently turned 15 which had entitled them to commence working shifts in food service. MWH worked with employees mostly around their own age (14- to 17- year-olds). Their store did have employees who were 21 years or older with the oldest being 65. The managerial roles were usually experienced staff members older in age. MWH was working at the same standard as everybody else who was working as a team member. Their duties as a team member were the same as the older team members. Every team member had a similar standard of work, and it was only if an employee was new that the standard of their work might be less. At this KFC to obtain this hurdle of shift supervisor you needed to be 18 years or older. However, when new employees had started MWH had been required to supervise and train them and some had been older than MWH. MWH had also been given the responsibility of being involved in closing the store. Their tasks included picking up items that were in the wrong place and taking them back to where they should be. They made sure utilities 89 Exhibit 65. 90 Exhibit 66. [2026] FWCFB 75 49 were well stocked and spread items out properly so that they looked neat and tidy. MWH lived at home with their parents and saved a third of their weekly income.91 [136] MW was a minor and a high school student. They worked at McDonald's and had done so for two years. They said most of the employees they worked with were aged between 15 and 19 years old. In the kitchen the work that 15-year-olds did was no different to the work of 19- year-olds. MW said that if you were trained on every role in the kitchen like they were then the work was the same for everyone. MW said last week they had worked for three hours and made $46. MW was living at home with their parents. They paid for their phone bill which was $15.00 a month.92 [137] TW was 21 years old and was employed at both KFC and Woolworths. They considered Woolworths to be their primary employment because they worked more hours there. They had commenced working at Woolworths at age 17. They had worked across a number of departments at Woolworths and had been working mostly in front end duties since early 2023. They had now gained enough experience that they occasionally trained new hires especially during the busy holiday seasons. Though they did not hold an official supervisory position management often entrusted them with the responsibility of training others. They did not always feel confident in teaching others but stepped up when necessary, especially when supervisors were unavailable. In their experience there wasn't a difference between what younger and older employees did when it came to tasks like shelf stacking or working in the deli. They all did the same tasks. One thing that was different for younger employees was the use of electric pallet jacks. If you were under 18 you were not allowed to use the electric pallet jacks because they were considered a bit dangerous. But anyone under 18 could still use the manual pallet jacks. Once you turn 18 and got the proper training you were allowed to use the electric ones. There were people of a mix of ages working on the registers including many employees under 18 and many over 21. The duties were the same for everyone. [138] TW had started working at KFC at age 16. TW's role at KFC had always been as a cook which was classified as a back of house position. They worked one shift per week at the KFC currently. They considered this was mainly due to the fact that they were more expensive to roster than younger staff and the store tried to limit their hours as a result. Their primary responsibility was to prepare and cook chicken. They also cooked bacon. It had taken them about 3 months to be confident working as a cook in the back of house alone. After three months the KFC stopped rostering them on with other cooks. They were 17 when they commenced working as the only cook in the back of house. They had continued to work shifts alone ever since. The tasks of a cook in the back of house were the same regardless of age. The only age- related restriction they could think of was a prohibition on those under 16 being employed as a cook. That was because people under 16 were not permitted to use the deep fryer and other important equipment. TW paid board and also had expenses including car expenses, phone, groceries, and entertainment. They were usually able to save some money at the end of the month, and they had a small HECS debt that they were paying off from six months at university.93 91 Exhibit 67. 92 Exhibit 68. 93 Exhibit 69. [2026] FWCFB 75 50 [139] LW was a young adult and employed as a team member at Woolworths. They had previously worked at two other Woolworths stores, one of them interstate. They had started employment as a 15-year-old casual employee. When they relocated interstate to go to university, they transferred their employment to a different Woolworths where they worked as a team member in the front end department and they had very recently transferred to another Woolworths store closer to where they lived. They were now working as a service supervisor. They had first become a service supervisor at the age of 17 at the first store. When RW had first started working at Woolworths in the checkout department most of their coworkers were high school students. There were about 10 high school aged employees, and they all perform the same duties such as operating the registers, packing bags and restocking items. The older full- time staff who were over 30 worked mainly during the day on weekdays while the younger employees worked weekends and after school. LW then moved to the bakery and was the youngest employee. The rest of the team were full-time employees over 25 years old but despite the age difference they performed the same duties. LW worked in the deli department with a mix of younger and older team members, and they all performed similar duties such as serving customers and cleaning the deli although the older workers prefer to operate the slicer and the younger staff were often expected to handle more of the cleaning tasks. As a service supervisor they had managed both younger and older team members. During weekends they typically supervised a mix of employees including three over the age of 21 with the rest being high school students. While managing older team members initially presented challenges due to their age, after a few months they gained confidence in the role and LW was then able to effectively oversee all front-end operations. [140] When LW moved to their current store, they noticed that the majority of their colleagues were over 30 years old with only a few younger team members still in high school. Despite the age differences the duties performed were generally the same, though the younger employees were more often tasked with physical jobs such as restocking and cleaning while the older staff tended to remain on the registers. LW lived at home with their father while attending university. Their main obligations financially included phone and car expenses and general living expenses. Car and fuel expenses were significant because of commuting to university. They said that despite working several shifts each week they found it challenging to save money.94 [141] ZWI was a young adult and employed at McDonald's. They had left high school at the beginning of year 10. They were currently studying a Certificate III in Retail Services which McDonald's were paying for. The study was all within paid working hours. They were currently employed as a Department Manager in Customer Experience and also did rostering. ZWI was employed full time, working 40 hours per week. They were being paid above the award rate for their age, at the rate for a 21-year-old. They performed exactly the same work as employees in the same role as them (Department Manager) who were 21 years or above. ZWI worked weekdays and weekends and did not have a set roster every week. They were rostered on to work between 6:00 AM and 11:00 PM.95 [142] ZWI had been working at McDonald's for slightly more than two years. They had initially worked at McDonald's in another state for approximately a year when they were 14 years old as a Crewperson. They moved interstate with their family in 2021 and applied for 94 Exhibit 70. 95 Exhibit 71. [2026] FWCFB 75 51 work at McDonald's once they had moved. They said they were immediately accepted because of their experience working at McDonald's. ZWI had a few months away from McDonald's in 2022 because they did not want to get a mandatory vaccination, but they then, at age 16, started working at a different McDonald's store. ZWI was offered as a position as a Crew person and after around 2 months they were promoted to a Crew Coach position. When ZWI turned 17 they started training to become a Shift Manager. After the training they had an unofficial title of shift manager but could not be officially appointed until they turned 18. While aged 17 they were supervised and worked with another Shift Manager. ZWI said that, because of their experience, after about four weeks of training they felt comfortable in the role of a Shift Manager. As a Shift Manager ZWI supervised up to fifteen crew whose ages ranged between 14 to 50. ZWI was in this role for approximately one and a half years. They were then promoted to Department Manager and again they found that within a few weeks they felt comfortable in the new role. ZWI had been in the role of Department Manager for over 5 months. In that role they supervised up to 15 crew. There were three Department Manager positions at the McDonald's, each with different duties. ZWI lived at home with their parents and paid board and expenses. [143] MMC was a high school student, in year 11, and a minor. They planned to finish at the end of the year and study an online tertiary course in animal care, in which they were already enrolled. MMC had previously been employed at a fast food restaurant for several months in 2022. They were currently employed by Big W. MMC was one of the youngest employees at the Big W. There were some others about the same age. There were some about 18 or 19 years old. Some were in their early 20s; some were aged between 30 to 45 and the oldest employee was about 50 or 60 years old. MMC said the older employees had different roles. Employees at the front door were about 40 to 50 years old. Employees in supervisor roles were about 20 to 60 years old. Otherwise, the work and roles of employees aged 19 and under was very similar. MMC lived with their parents and grandmother. They tried to put 80% of their income towards savings but this was not always possible. The remainder went to expenses like car insurance, registration and fuel, and spending.96 [144] BW was a minor and a high school student. Their first job had been distributing pamphlets by bicycle, at age 14. They were now employed at Hungry Jack’s as a Crew Member. BW was about to begin the role of Team Leader and was expecting a promotion to Crew Coach when they turned sixteen in a couple of months. Crew Members were generally aged 14 to 17 years old. The more experienced Crew Members made burgers and the less experienced Crew Members remained near the fryers, packing onion rings and nuggets. This was based on experience rather than age. “Out back,” BW worked alongside mostly older Crew Member employees 16 to 18 years old. BW’s work was no different from the work that these employees performed. BW did the same tasks as them and to the same standard. BW was paid less than the older employees because they were younger. BW said the Team Leaders were usually 15 years old, or older. Crew coaches were usually 16 or older. Crew Coaches differed from Crew Members or Team Leaders because they had ‘all-round’ responsibilities. The Managers were usually 21 years old, or older. Managers had 'all-round' responsibility including the counting of the cash registers and dealing with difficult customers. BW lived at home with their parents and 96 Exhibit 72. [2026] FWCFB 75 52 saved half of their weekly income. BW planned to get their driver’s license when they turned 16. BW was saving for a car.97 SDA lay witnesses required for cross-examination (community pharmacy industry) [145] As indicated above most of the SDA’s lay witnesses were not required for cross- examination. The Pharmacy Guild required four of the SDA’s lay witnesses for cross- examination, and they were made available. They were BC, CM, KM and KP. [146] BC was an SDA organiser who had worked in pharmacies as a teenager. They had left the pharmacy industry aged 21 but had returned to the industry briefly as a qualified HR coordinator before becoming an SDA organiser. They gave evidence of their experiences in pharmacy as a teenager, and also as to the HR practices when they were a HR coordinator. BC said that in their experience the pharmacy assistant did the actual packing of medication, to the point of it being sealed, and then a pharmacist would review what the pharmacy assistant had done. BC’s mother had been their mentor in their early days of being a pharmacy assistant and they had also worked with a great aunt.98 [147] CM was a 19-year-old Level 2 pharmacy assistant at Chemist Warehouse. They had previously been employed at KFC and then Bunnings Warehouse. CM was in their second year of university. They had taken two to three months to become comfortable in their role at Chemist Warehouse. There were employees of a variety of ages at the pharmacy, though all the employees working Saturdays, bar one, were under 21. CM said there was no difference in duties based on age. The difference in duties which exist were based on a person's experience in the workplace. For example, a colleague aged 20 could do all of the same tasks as another colleague who was middle aged, because the 20-year-old colleague had more experience. CM said the roster set out for the workers on the shift who was doing what and when. CM said the roster showed the till times, rubbish duties, returns, display boxes, and stock. CM said they all did a bit of everything on a shift. This was based on experience. It was not based on age. CM lived with their mother and two brothers, one of whom was now working. CM’s mother worked part time. CM’s expenses each week were spent on board, rent, the household groceries (CM went half or alternated with their brother), petrol for the family car, the phone bill (covering the four mobiles the family had) and the wi-fi bill. CM was trying to save up for a car as the family only had one. As at the time of the hearing, CM said they had worked at the pharmacy for around six months.99 [148] KM was a young adult working in pharmacy. They had commenced at age 16. They were a Pharmacy Assistant Level 1. The pharmacy had four sections: the front till, the floor, the dispensary, and the Webster packing station. There was usually one employee working at the front till, another who was a floater, working on the floor and at the till when necessary, and three at the dispensary: a pharmacist, a pharmacy assistant, and a dispensary technician. At age 16 KM had trained three employees; one who was 35 and two who were over 50. At age 17, KM had received training on how to work in the dispensary. They considered this role to be quite difficult because there was a lot of information to learn and processes to follow. Some 97 Exhibit 73. 98 Exhibit 10. 99 Exhibit 8. [2026] FWCFB 75 53 medications were restricted, with limitations on when prescriptions could be filled. You had to understand the meaning of notes in prescriptions such as “BD” (twice daily) or “D28” (discard after 28 days). Some customers had difficult questions. Some medications were kept in a safe. Some prescriptions had to be in handwriting. The role was constantly changing with new medications and new regulations always being released. KM felt comfortable working in the dispensary after six months. Shortly before turning 19, KM started packing medication at the Webster station. KM said employees completed the same tasks on the floor, till and dispensary. It did not matter how old the employee was. Employees progressed as they gained experience. A younger employee would be taught on the till and floor position and become comfortable. Once they were comfortable in those roles they advanced on to learning the dispensary. They said the technician would put it through the computer, process the prescription, get the medication, label it, do the paperwork, and then hand it on to the pharmacist to check. This related to all prescription medications, and all S3 (over the counter) medications.100 [149] Under cross-examination KM explained that their role in explaining medication did not relate to restricted medication, which the pharmacist had to explain. But for something like cholesterol medication they were able to explain why the customer should wait a particular amount of time before refilling again. However, they would always check with the pharmacist before turning someone away. KM explained what happened when a customer brought in a prescription. They said it was received by the pharmacy assistant, and then either a dispensary technician could dispense it, or the pharmacist could dispense it, but it always had to be double checked by the pharmacist if a dispensary technician did it. Also, for some controlled medications the technician could not get the medication. In that case, they would process the prescription, do the paperwork, and then leave the label for the pharmacist to get the medication and label it. They said that for some medication the pharmacist would want to talk to the customer, but for regular medication a pharmacy assistant or dispensary technician could hand it out. They said they would also talk to doctors directly if there were issues with the prescription. They also packed Webster packs for the pharmacist to check. [150] KP was a 53-year-old pharmacy manager who had worked in the pharmacy industry since 1984 beginning as a pharmacy assistant at age 13. Over the past 15 years they had mostly managed pharmacies in regional NSW. Their first management role was at a pharmacy where they ultimately worked for 27 years, including as a manager for five years. Their most recent management role was at a Priceline store for six years. They had left a year before making their statement. KP currently worked as a dispensary technician at a pharmacy. They did not have any formal qualifications in pharmacy. At the Priceline store that KP managed there were about 17 to 18 employees on the books including pharmacy assistants, dispensary technicians, and pharmacists. KP considered that the tasks for junior and senior staff were essentially the same especially when it came to customer service and consultation. There were no limitations based on age as to the sorts of tasks employees could perform. Rather than age KP allocated tasks depending on work experience and availability.101 Under cross-examination KP said they did not consider a casual employee, or someone interested in a different career path outside health or pharmacy, more likely to be indifferent to the job than a permanent employee. They said they had just found that workers had varying degrees of interest. 100 Exhibit 9. 101 Exhibit 12. [2026] FWCFB 75 54 Ai Group lay evidence [151] Ai Group called lay witnesses from Domino’s, Craveable Brands, Hungry Jack’s, and McDonald’s, all of whom were cross-examined. They were: • Mr Nathan Carrington, Head of Corporate Operations ANZ, Dominos;102 • Ms Jennifer de Witte, an Employee Relations Consultant, Craveable Brands (which operates Red Rooster, Oporto, Chicken Treat, and Chargrill Charlie’s);103 • Mr Tim Humphreys, sole director of the trustee for Humphreys Family Trust, a franchisee of Craveable Brands operating Red Rooster restaurants;104 • Ms Christine Bletsas, Chief Financial Officer, Hungry Jack’s Pty Ltd;105 • Ms Robyn Johnston, State People & Culture Partner (South Australia, Northern Territory, and Tasmania), Hungry Jack’s Pty Ltd;106 • Mr Samuel Morton, General Manager – Western Australia, Hungry Jack’s; 107 • Mr Christopher Turner, Director – Workplace Relations and Safety, McDonald’s Australia and New Zealand, McDonald’s Australia Limited;108 • Ms Christine Wallace-Hughes, Director of McOpCo, McDonald’s Australia Limited;109 • Mr Matthew Beattie, Head of Restaurant Finance North & East, McDonald’s Australia Limited;110 • Ms Mandy Sharp, People Director – Restaurant People Partner, McDonalds Australia Limited, and CEO of McDonald’s Registered Training Organisation.111 [152] The SDA objected to some parts of the fast food industry witnesses’ evidence to which we have had referred below. These objections were subject to the parties’ general approach described above where parties were content for most of the objections to be dealt with as a matter of weight. We have considered the objections and formed the view that the evidence to which we have referred, below, is of assistance to us, having regard to the relevant witness’s experience and position. We appreciate that parts of the witnesses’ statements were generalisations and we have taken that into account. We appreciate parts were hearsay and/or opinion and we have exercised caution particularly where the witness refers to matters we consider likely to be outside the scope of their knowledge. Domino’s [153] Mr Nathan Carrington was Head of Corporate Operations ANZ for Domino's Pizza Enterprises Ltd. Mr Carrington had been in that role for about one year. He had first worked for Domino's as a delivery driver in 2002 at around the age of 18 and was promoted to the role 102 Exhibit 94. 103 Exhibit 92. 104 Exhibit 101. 105 Exhibit 95. 106 Exhibit 86. 107 Exhibit 88. 108 Exhibit 104. 109 Exhibit 89. 110 Exhibit 97. 111 Exhibit 93. [2026] FWCFB 75 55 of store manager in 2003. In 2005 he was promoted to the role of corporate regional manager. He then became a Domino's franchisee, eventually owning 6 stores. After being a franchisee for around 15 years Mr Carrington rejoined Domino's as an employee in late 2022 in the role of National Operations Manager for Corporate Stores. He held that role for roughly 2 1/2 years before starting his current role in mid-2024. Mr Carrington said the majority of Domino's restaurants are franchise owned rather than corporate owned. There were about 750 franchisee stores and 55 corporate stores. Most of the corporate stores were in Sydney and Melbourne whereas franchisee stores were more widely distributed including in regional areas. [154] Mr Carrington said a typical Domino’s store (whether corporate or franchisee owned) had three to five in-store employees, who were often between the ages of 15 to 16. Their job was to handle transactions, provide customer service, resolve minor concerns and ensure a positive experience; assist with food preparation, folding boxes and stocking items; maintain clean workstations and customer area; undertake pizza making, pizza cutting, dough making, and delivery dispatch; and to use dishwashers and do any ancillary tasks. He said there would also typically be around 10 to 15 delivery drivers, whose job was principally to deliver orders to customers, but who also performed in-store customer service duties when not on the road delivering. Mr Carrington said delivery drivers were typically 17 years or older (18 years or older in Victoria) because (with the exception of E-Bike riders) they need to have a driver’s licence. Domino’s and its franchisees employed some 16-year-olds with valid Learner’s permits to work as delivery drivers using E-Bikes. Delivery Experts were usually employed on a part- time or casual basis. In terms of supervisors and managers Mr Carrington said a typical store would have a type of intermediate supervisor known as a ‘shift runner,’ managers in training, assistant managers, and a store manager. He said managers were generally older than crew members and were usually at least 20 years old. [155] Mr Carrington said that as far as he was aware the Fast Food Industry Award applied to all employees of Domino’s and its franchisees working in stores in Australia. He said if the application were granted it would add additional pressure to an already very challenging financial environment. Mr Carrington said that most Domino’s franchisees are small businesses. He said if the rates were changed it would have a huge impact on the investment including its value and had the potential to impact their ability to support their families and repay debt they had incurred to purchase the store. He said the Domino’s business is a high- volume model where stores need to sell a lot of food with a low margin on sales to make a profit. [156] Mr Carrington said that because people in Victoria cannot get their provisional driver’s licence until they turn 18 years old, the youngest delivery driver (save for E-Bike riders) that Domino’s can employ in that state was 18. If 18-year-olds were to be paid the adult rate of pay, that would have a major impact on the ability of all Victorian stores to make a profit, as it would immediately increase the minimum wage for delivery drivers by 43 per cent. He said in all other States where people can get their driver’s licence at 17, the current system gave Domino’s and its franchisees a clear incentive to hire 17-year-olds as delivery drivers because they are cheaper to employ and with the right attitude, they could be trained up over 12 to 18 months into strong team members and eventually managers. However, if 18-year-olds were to be paid adult rates the ability to fully train someone while they were still at a lower rate would disappear, and the business would also lose the return on investment from the time and effort spent training them. Mr Carrington considered that for most young drivers it took at least a year in the business [2026] FWCFB 75 56 before you could even begin developing them into more valuable team members. Mr Carrington said that if Domino’s and its franchisees were required to pay 18, 19, and 20-year-olds the full adult rate, they may be more inclined to hire individuals who are either younger (due to lower applicable wage rates) or older, who often bring greater skill and maturity to the workplace. He also said if junior rates were to increase then franchisees would likely choose to employ, or allocate more hours to, senior team members who had experience rather than take a chance on a junior. Juniors would not be able to compete with senior workers due to lack of experience. He also said that if he were a franchisee and had two applicants for any job level below supervisor, where one was 16 and on 50% of the adult rate, and the other was 18 and would receive 100%, he would hire the 16-year-old. [157] He said team members over 20 years of age tend to demonstrate more consistent reliability, maturity, and responsibility, particularly during peak trading periods such as Fridays and Saturdays. He said that for many juniors Domino’s was their first job. They were learning not just Domino’s systems but also how to have job responsibilities. He said without previous experience juniors often had some anxiety or nerves when handling customer relations or other tasks and tend to rely more on parents or carers to help deal with work-related issues. They required more accommodations, supervision, training, and guidance. However, work built up confidence, and young people were a clean slate, receptive to information and mouldable, and were used to learning. Mr Carrington said of the six stores he used to own, all were now owned by people who had started working for him as delivery drivers or instore crew. He said each of them had gone from being young teenagers who struggled to answer a phone or serve a customer to owning and running a business, and that was his personal experience as well. He said people learned how to run successful businesses, without having the risks associated with owning the business while learning. He said the skills are highly transferrable, and being able to learn at Domino’s gives opportunities that they maybe would not have had otherwise. [158] Mr Carrington also considered that if junior rates changed, Domino’s and its franchisees might look to alternatives to delivery by employees, such as delivery by Uber. They had already been experimenting with this. [159] Mr Carrington said that junior rates were important for both hiring and rostering decisions. Stores typically chose to hire younger employees in crew positions and roster them during shifts that attracted a penalty rate. The profile of applicants varied between locations. On the Central Coast of New South Wales it was common to see 16-year-olds looking for a job after school, or 17-year-olds looking for a driving job first after school then while at university. In Sydney and Melbourne there were a lot more international students who were looking for work who could give Domino’s 23 hours per week, and stayed for a couple of years while studying. The international students were usually at least 17 years old. [160] Mr Carrington said young employees usually had more limited availability than people who were not at school or studying, but were typically available to work on weekends. He said the busy period was between 5 pm and 8 pm. Mr Carrington said Domino’s customers are price sensitive. He believed if the price of pizzas went up they would lose some customers and demand would decrease. He referred to increases in the cost of ingredients, and the greater likelihood of franchisees reaching wages thresholds for payroll tax given labour cost increases. [2026] FWCFB 75 57 Craveable Brands (Red Rooster, Oporto, Chicken Treat, and Chargrill Charlie’s) [161] Ms Jennifer de Witte was an Employee Relations Consultant at Craveable Brands, which operates Red Rooster, Oporto, Chicken Treat, and Chargrill Charlie’s. They had a workforce of 13,853 people, most of whom were employed by franchisees. Ms de Witte provided the following breakdown of their workforce by age:112 Age Corporate Stores Franchised Stores Total 15 years or less 46 1917 1963 16 years 46 1824 1870 17 years 44 1672 1716 18 years 16 1310 1326 19 years 13 913 926 20 years 8 682 690 21 years and older 65 5119 5184 [162] Most of the workforce was covered by and paid according to the Fast Food Industry Award, though 210 were covered by enterprise agreements, and a further 19 were covered by a Western Australian industrial instrument. Most of the employees were casual. The distribution of roles by ages was:113 Age Crew Crew Trainer Shift Supervisor Assistant Manager Restaurant Manager 15 yrs or less 1941 14 0 0 0 16 yrs 1813 56 0 0 0 17 yrs 1601 94 20 0 1 18 yrs 1113 62 144 2 5 19 yrs 701 24 190 8 3 20 yrs 453 39 178 7 13 21 yrs and older 2835 107 1274 137 320 Total 10457 396 1807 154 342 [163] Ms de Witte said most employees aged 15 years or less started in their position as crew members. Around 79% of employees of all ages joined as crew members. Around 40% of all employees of Craveable were under 18 years of age, and around 62% were under 21 years of age. The average tenure based on age was as follows:114 Age Average Tenure 15 yrs or less approximately 2 months 16 yrs approximately 7 months 17 yrs approximately 11 months 18 yrs approximately 1 year 3 months 112 Exhibit 92, [8]. 113 Exhibit 92, [11]. 114 Exhibit 92, [14]. [2026] FWCFB 75 58 Age Average Tenure 19 yrs approximately 1 year 4 months 20 yrs approximately 1 year 8 months 21 yrs and older approximately 2 years 10 months Total approximately 1 year 7 months [164] Ms de Witte said school aged kids were more likely to work nights and weekends compared to adults who covered day work and any hours beyond 10 pm depending on the state or territory. [165] Ms de Witte said she did not find the current junior rates system difficult to understand. Their time and attendance system automated payment according to dates of birth. If the variation was made there would be costs involved in transitioning to the new system, which would not be a simple update. Eventually it would require only the same amount of effort as the current system. In addition, they would need to train their franchisees, and make major adjustments to their payroll system, which would introduce complexity in pay calculations, auditing, and reporting. [166] Mr Tim Humphreys was sole director of the Trustee for the Humphreys Family Trust which was a franchisee of Craveable, operating nine Red Rooster restaurants in Queensland. He said he had worked with Red Rooster as a brand since first starting as a casual junior team member aged 14, save for a short stint with another employer. He said his first position was as a kitchen hand, then kitchen hand and cashier, then crew trainer, then Assistant Manager, then Restaurant Manager. He said he was a Restaurant Manager for five years then worked as an Area Manager before becoming a franchisee. He had been in that role for 11 years. In summary Mr Humphreys said, inter alia, the following: • He expected different outcomes for a junior employee (aged under 21) when compared with a 30-year-old. This included junior managers when compared to a 30-year-old manager. • Both work and life experience contributed to work performance. • Employees aged under 21 were generally able to work safely but often lacked the experience to forward-think and foresee events. They were more reactive than proactive when it came to issues of safety. They were less likely to be able to adequately deal with safety incidents, e.g. small fires, and more prone to panic. • Inexperience and immaturity affected all facets of work output such as the quality of work, good customer service, multi-tasking, prioritising and work activities. • His stores each had five to six managers including shift supervisors and restaurant managers, allowing young managers to be coached properly. • Younger employees worked a little slower, and passed more difficult problems onto more senior employees. They needed more direction. • Cash issues were more prevalent with junior staff, especially where there was a shortfall which they would leave with a senior manager to deal with. Employees aged under 21 seemed less aware of the need to keep cash secure. They were generally less careful with cash handling and never identified fake money notes at the time of transaction, which more senior employees did. • Junior employees needed more time off for mental health reasons and were less resilient. They were also more prone to become more frantic, stressed and upset when [2026] FWCFB 75 59 they made mistakes and took more time to recover. They were also more likely to be distracted. [167] Mr Humphreys said the decision whether to promote employees depended on performance. He said his restaurants tried to promote employees aged under 21 earlier if the business liked their attitude as they knew those employees would take longer to train. He said they tried to pair younger supervisors with a more senior supervisor during shifts. He said if junior rates changed as proposed they would be less willing to promote and train younger employees into higher roles because there would be no cost incentive to do so. [168] Mr Humphreys said junior employees’ availability was more sporadic than others’. He said if junior rates changed he would prefer to hire employees over university age. He said he would expect them to stay longer than someone who was only working at the restaurant while they finished school or university. He said there were costs associated with hiring including onboarding and training costs. Hiring older employees would mean he would have a more stable and regular workforce than junior employees. Currently the junior rates were a good enough reason to hire juniors over an older workforce despite being less stable, having less availability, and having higher staff turnover. [169] Mr Humphreys said two senior staff could do the work of a small team of junior staff. He said if junior rates changed, he would likely replace junior staff with fewer senior staff. He said his preference for unplanned absence was to replace them with someone with similar cost and skills. When there was need for additional staff because of events in the community he preferred to put on more junior employees because their wages were lower. Mr Humphreys anticipated that if this application were to be granted, eighteen-year-olds would get fewer shifts. He expected they would complain about that which would create less harmony and cooperation with the business. He said currently this did not happen until employees were turning 21 but they were then put on a career pathway and progressed to management. [170] Mr Humphreys said if junior rates changed as proposed it would lead to an increase of $590,000 per year in costs across his businesses. This would lead to a decrease of $2 to $2.1 million in valuation for them, because of the impact on profits. He said that would leave him with insufficient equity in his businesses and the bank would notify him for being overleveraged. He said he had approximately $2.3 million in debt.115 He said if junior rates changed it was highly likely that the business would go into liquidation and he would sell multiple stores. He said he currently had one store making a loss and if junior rates changed in accordance with this application that would increase to four stores making a loss. He considered he would not be able to increase prices. He said there was a high likelihood he would have to exit the fast food industry. Hungry Jack’s [171] Ms Robyn Johnston was State People & Culture Partner (South Australia, Northern Territory, and Tasmania) employed by Hungry Jack’s Pty Ltd. She had been employed by Hungry Jack’s for 32 years and had been in her current role for 7 years. Ms Johnston gave 115 Exhibit 101, statement of Mr Humphreys, [39]. [2026] FWCFB 75 60 evidence of employment at Hungry Jack’s restaurants including franchised restaurants as follows:116 (a) 6761 employees aged under 16; (b) 5747 employees aged 16; (c) 4678 employees aged 17; (d) 3460 employees aged 18; (e) 2238 employees aged 19; (f) 1506 employees aged 20; and (g) 5022 employees aged 21 and over. [172] She said their rostering reflected variations in laws relating to the employment of minors in the various states, and that Hungry Jack’s had a Responsible Student Policy, a copy of which was tendered.117 She referred us to the various restrictions regarding the employment of minors across different restrictions. [173] Ms Johnston said the overall financial consequences associated with the rate of pay a person would be entitled to was a factor that was taken into account when making hiring decisions. She said that where Hungry Jack’s had a range of candidates with the same experience or the same lack of experience, they would consider who would be most cost effective in the role and may preference that candidate to reduce cost. She said that under the Hungry Jack’s enterprise agreement junior rates were: Under 16 years of age, 40% 16 years, 50% 17 years, 60% 18 years, 70% 19 years, 80% 20 years, 95%. [174] Ms Johnston said teenagers had a large amount of HR issues but despite the challenges the financial incentive was enough for Hungry Jack’s to hire large numbers of juniors. Ms Johnston said that if junior rates were varied it would not be financially viable for Hungry Jack’s to continue to roster the same number of people and recover the additional costs by increasing prices. Alternatively, if they reduced the number of people on shift that would increase multi- tasking, cause stress, and prevent Hungry Jack’s from rostering people on only to talk to customers in the restaurant, staff the “drive thru” window or wash dishes. She said juniors were often rostered for short shifts after school or on weekends. She said junior employees were quite often at a lower skill level or needed “extra resilience support” when things were busy or stressful. She gave evidence as to the difficulty of rostering junior employees because of constraints on their availability. She said availability constraints affected how long it took junior employees to become proficient. [175] Ms Johnston said younger workers often did not know what it was like to work in a workplace or what was expected workplace behaviour. She said younger workers needed to 116 Exhibit 86, statement of Ms Johnston, [16]. 117 Exhibit 87, HJ024 Responsible Student Policy. [2026] FWCFB 75 61 learn a lot and that Hungry Jack’s adjusted its expectations accordingly and were willing to cut teenagers venturing into the world of work for the first time a great deal of slack. In contrast Hungry Jack’s had higher expectations of people aged 21 or over coming in at the adult wage, and to a lesser extent people aged over eighteen. She said juniors aged 17 or below get distracted compared to older workers, and needed higher levels of supervision because they did not understand the consequences of their actions, and also because they needed to be kept on task. She said teenage workers were often more tired because they needed more sleep and were often juggling school, family, social and sport commitments in addition to work. She said juniors were more likely not to disclose safety issues as they did not want to be seen as a snitch or get managers in trouble. She also said a lot of things made younger workers upset, citing outside factors such as troubles at home and others. She said young workers needed a lot more conversations about how to look at people, make eye contact, smile and read social cues, and to be trained in relation to how to deal with stressful situations including angry or abusive customers. Ms Johnson said younger workers were not used to handling cash and needed extra training and supervision as they learned how to count money, count back change, and operate a cash register. [176] Ms Johnston said that if this application was to be granted, there would be no compelling reason to hire or allocate hours to someone in the 18 to 20 age bracket compared with someone older than 20. There would be a reduction in hiring and the allocation of hours to people in that bracket. Ms Johnston said if junior rates were flattened there would be less incentive to put teenagers on. If the financial incentive was to be removed or scaled back then teenage workers would miss out and no longer have the job opportunities they currently had. [177] Mr Samuel Morton was General Manager – Western Australia for Hungry Jack’s. He had previously worked for a company that had operated KFC brand restaurants in Western Australia and the Northern Territory. The KFC part of that company’s business had been sold in 2013; Mr Morton had stayed with the company until joining Hungry Jack’s in 2015. He said the current system of junior rates was not complex; if someone had a birthday, they got a payrise. He said that when he had been a Restaurant Manager and District Manager for KFC in the 1980s, they had employed their staff under an industrial instrument that had adult rates of pay starting at 18 years, and that this instrument and the ones applying to Red Rooster and Hungry Jack’s had been very similar. He said that at the time they tended to employ school children and then adult workers over 25, with few employees between 18 and 25. He said that a union had successfully applied to change the junior rates to address high youth unemployment, and that the junior rates changed so that adult rates commenced from age 21. He said the new rates were in the Fast Food Outlets Award 1990. He said they started employing people aged 18 to 20 in the stores he had responsibility for. Mr Morton annexed copies of the union’s application and related materials to his witness statement. [178] Mr Morton said older workers were more mature, while younger workers did silly things and needed more supervision. He said if junior rates changed Hungry Jack’s would employ less people overall. He said they may employ a lesser number of older workers to do the same amount of work that a greater number of junior workers would have been required for. He said two 25-year-olds could do the work of three 15-year-olds. Secondly, he said the industry would accelerate uptake of artificial intelligence. He said Hungry Jack’s was currently looking at AI taking drive-thru orders, and drive-thru was around 70 percent of their business. He said he expected they would start using AI to take orders in the next ten years but if junior rates changed [2026] FWCFB 75 62 this would be expedited. He also said that if labour costs went up Hungry Jack’s would absorb some of the cost and would also increase prices, which would adversely affect sales in the medium term. He said around three months after any changes took effect there would be changes to the hiring practices. [179] Ms Christine Bletsas was Chief Financial Officer for Hungry Jack’s Pty Ltd and had been in that position since September 2019. Her evidence was subject to a confidentiality order in respect of certain commercial matters. She said that as at 28 April 2025, Hungry Jack’s had 473 Australian restaurants of which 392 were directly operated by Hungry Jacks. She said Hungry Jacks operated in all States and territories of Australia. She said Hungry Jacks continued to hire young workers who were trained to work in a team environment on the job. She said when junior team members were on shift they allocated more hours to the shift to mentor and encourage teamwork whilst providing the quick service their customers expected. She said higher labour costs would mean lower ability to allocate appropriate hours affecting the guest experience and ultimately sales and profitability. Ms Bletsas said Hungry Jacks was growing and the growth was being driven by products and promotions delivery services and trading hours expansion. She said that if the application in these proceedings were to be granted that would affect profitability, service levels, and trading hours. She said their margins would be lower due to the higher labour cost and could result in reduced availability of jobs and hours. [180] Ms Bletsas said that Hungry Jack’s experienced cost pressures in a number of areas including construction costs, exchange rate volatility, ingredient prices, utilities, rent increases and award rate increases. She said Hungry Jacks operated in a competitive environment and that its retail process would benchmark very closely to their competitors to ensure it maintained its competitive position in the market. Ms Bletsas gave evidence about the Hungry Jacks National Enterprise Agreement 2019. That Agreement applied to the classifications of Crew member, Crew Member - Team Lead, Shift supervisor, Assistant manager, Restaurant manager, and Salaried employee (a full-time assistant manager or manager paid a salary). She said that as a general rule Hungry Jacks restaurant Managers were salaried. She said under the Agreement the Shift Supervisor role had been redefined into two roles, Crew Coach and Certified Shift Supervisor. The Certified Shift Supervisor role paid at a higher rate than the general Shift Supervisor role. [181] Ms Bletsas also provided other information about the Agreement including that the junior rates under that Agreement were at 95% for workers 20 years of age, rather than the Fast Food Industry Award rate of 90%. [182] Ms Bletsas took a sample of 10 Hungry Jack’s restaurants which she said she used to prepare an indicative profile of the workforce. She said that across these 10 restaurants there were 582 restaurant employees as of 28 April 2025. She said:118 • 18.4% of them were aged under 16; • 19.1% were aged 16; • 18.0% were aged 17; • 11.3% were aged 18; • 8.8% were aged 19; • 5.3% were aged 20; and 118 Exhibit 95, [30]. [2026] FWCFB 75 63 • 19.1% were aged 21 or over. [183] She said 79.2% of the workers were casuals. As to classifications:119 • 77.5% were Crew; • 1% were Crew Member – Team Leads; • 10.3% were Crew Coaches; • 4.5% were Certified Shift Supervisors; • 5.2% were Assistant Managers; and • 1.5% were salaried Restaurant Managers. [184] Ms Bletsas provided the following information about the length of tenure by age across the sample of restaurants as follows:120 Employee tenure Employee Age 0-6 months 6 months to 1 year More than 1 year – less than 3 years 3 years to 5 years More than 5 years Under 16 years 45 41 21 16 years 24 21 66 17 years 13 19 59 14 18 years 14 10 25 17 19 years 9 11 17 13 1 20 years 2 4 18 6 1 21 years & over 5 6 40 17 43 [185] Ms Bletsas calculated the cost impacts of the application if granted including her calculation of the overall reduction in EBITDA for the 10 restaurants. She said three of the 10 stores would move from profit making to loss making. [186] Ms Bletsas said if the application were to be granted that would affect the profitability, service levels, and trading hours of Hungry Jack’s. She said profitability would decrease, the speed and quality of service would reduce, and the viability of remaining open for late night trade would be affected. She said if the application were to be granted their demand for junior employees would decrease, and there was a possibility of increased closures of existing restaurants. McDonald’s [187] Ms Christine Wallace-Hughes was employed by McDonalds in the position of Director McOpCo. She had been employed by McDonalds or its licensees for 32 years. In addition to her witness statement she provided the McDonald’s interview and hiring guide, and its Responsible Student Policy.121 She said she had held all positions in the restaurant as well as 119 Exhibit 95, [32]. 120 Exhibit 95, [33]. 121 Exhibits 90 and 91 respectively. [2026] FWCFB 75 64 several roles in the corporate office, both in relation to McDonald’s operating company referred to as McOpCo and in relation to licensees. As Director McOpCo she had responsibility for managing all McOpCo (McDonald’s corporate-owned) restaurants. Ms Wallace-Hughes said restaurant managers made hiring decisions after hearing from other managers in the restaurant about whether they had sufficient coverage of workers to meet the restaurant’s needs. She said McDonalds had factsheets available to Restaurant managers in relation to employing categories of workers with restrictions including child employment restrictions. She said decisions to hire were also based on job interviews, and McDonalds had an Interview and Hiring Guide. Hiring decisions into a more senior position also occurred through internal promotion. She said most employees started with McDonalds younger than age 19. For more senior roles they tended to hire from internal candidates who had progressed, rather than hiring people who had had no experience with McDonalds. She said they hired young and developed and promoted from within. [188] Ms Wallace-Hughes said McDonalds had a rostering system for employees to input their availability. She said availability to work differed with age, both because of child employment restrictions and because of workers’ other commitments. She said workers under 21 often had study commitments for school or university, as well as extra-curricular activities such as sport or travel. She said rostering decisions took into account child employment restrictions, compliance with McDonald’s operating principles and compliance with modern award requirements, as well as other factors. The other factors included their preference to have a mix of employees of different ages, and with different amounts of experience. She said their ideal shift would be to have a mixture of experienced crew across several levels including Crew, Crew Coaches, Shift Manager and Restaurant Manager. She said it may be challenging to have only 14- or 15-year-olds as they did not have the depth of experience or proficiency that McDonald’s required. For roster substitutions they preferred ‘like for like’ in relation to age. [189] Ms Wallace-Hughes said workers aged 14 to 18, and recent school leavers aged 18 to 19, tended to be more easily influenced by others and easily distracted and excited, and when that occurred they were less productive. On the other hand, the influence could be motivational in which case the opposite would happen. She said their performance was inconsistent. She said workers over 21 tended to be less distractable. Ms Wallace-Hughes also said workers aged 14 to 18, and recent school leavers aged 18 to 19, had less experience engaging with strangers than people over 21. She said it could be their first time in the workforce and they were more frequently timid and shy. They needed time to build confidence. Young workers also needed to get someone more senior to handle difficult customers. [190] She said interpersonal conflict was more likely among workers under 21 than older workers. She said emotional regulation increased with age and experience. Ms Wallace-Hughes said if someone made a mistake requiring a formal conversation, and they were aged under 18, they required them to have a parent or guardian present. She said the likelihood of an employee making silly mistakes decreased with age and experience, as did understanding appropriate workplace behaviour. She said McDonald’s was more understanding of minors not following policies, than 30-year-olds. [191] Mr Christopher Turner was Director – Workplace Relations and Safety of McDonald’s Australia and New Zealand, employed by McDonald’s Australia Limited. Mr Turner said there were 1,035 McDonald’s restaurants in Australia of which around 85% were franchises. He said [2026] FWCFB 75 65 that as at 25 June 2025 McDonalds and its franchisees employed about 116,847 people across the country, of whom 115,176 (around 99%) were employed in restaurants. He gave the following average ages and lengths of service, by job:122 Mean123 age Median age Mean length of service Crew Member 18 17 1 year, 6 months Shift Manager 23 22 4 years, 1 month Department Manager / Assistant Restaurant Manager 23 23 5 years, 10 months Restaurant Manager 30 27 12 years, 8 months [192] Mr Turner said Crew Members and Crew Coaches were both considered to fall within classification Level 1 under the Fast Food Industry Award, Shift Managers were within Level 2, and Restaurant Managers were within Level 3. The distribution by age across those classifications was as follows:124 Age Level 1 Level 2 Level 3 14 2,329 0 0 15 13,830 0 0 16 21,468 0 0 17 19,947 10 0 18 14,759 316 0 19 8,854 1,091 11 20 5,807 1,220 16 21 and above 18,977 5,536 1,130 [193] Mr Turner said McDonalds had a Responsible Student Policy, which applied to all McDonald’s restaurants as well as those operated by franchisees. He also provided a copy of McDonald’s 2018 Corporate Social Responsibility report. [194] Mr Matthew Beattie was employed by McDonald’s Australia Limited as Head of Restaurant Finance North & East. A confidentiality order covered part of his evidence in relation to specific commercial information. Mr Beattie had been in his current role since 2023. He had started working part-time as a crew member at McDonald’s in 2007 while at school and had also worked for McDonald’s while at university. After finishing his undergraduate degree in 2012 Mr Beattie had been employed in the role of Assistant Accountant and had spent the (then thirteen) years since working in field finance for McDonald’s restaurants, both corporate and franchised. He had spent five years looking after McDonald’s McOpCo restaurants. He had then changed to the franchisee side of the business and now worked directly with franchisee operators in Queensland and New South Wales. His job was to make sure franchisee operators were running their businesses within McDonald’s financial guidelines. Mr Beattie had done some of his own calculations of the impact on total costs across all McDonald’s restaurants in 122 Exhibit 104, [7(b)-(c)]. 123 Mr Turner referred to averages and medians. We have taken his reference to average to be a reference to the mean. 124 Exhibit 104, [7(e)]. [2026] FWCFB 75 66 Australia, using data from the corporate restaurants and extrapolating for franchised restaurants. He estimated the reductions in earnings before interest, tax, depreciation, and amortisation that he considered would occur if the application were to be granted. He was of the view that EBITDA would reduce for franchisees which would in turn decrease the value of their businesses. He said that the reduction in EBITDA would lead to restaurant closures and gave an estimate of the likely number of closures, affected staff, and affected licensees. He also gave estimates of the percentage of proposed new restaurants in the pipeline that would not open. Mr Beattie’s opinion was that EBITDA could not be maintained at current levels through price increases. [195] Ms Mandy Sharp was employed in the role of People Director – Restaurant People Partner for McDonalds Australia Limited and was also CEO of the McDonald’s Registered Training Organisation (RTO). She had been employed by McDonald’s since 1994. Ms Sharp said McDonald’s employed more than 115,000 people in restaurants and corporate offices Australia-wide and was one of the largest employers of youth in the country. She said McDonald’s spent over $60 million per year on training and people development, the bulk of which was directed toward the training and development of young people. She said the McDonald’s RTO had initially been registered as an Enterprise RTO in 1997 and had issued more than 50,000 Qualifications and Skill Sets to its employees since that time. She said that McDonald’s also offered school-based traineeships to employees who attended school and were in years 10 to 12. Ms Sharp gave evidence of the current enrolment in courses via the McDonald’s RTO, and also as to the different means by which McDonald’s delivered training more generally. [196] Ms Sharp said that for a lot of people who worked at McDonald’s, it was their first job. She said their training programs had been designed to take into account those workers were young, did not have any work experience, and may work infrequently. As an example, she said McDonalds trained people in foundational work skills such as: • how to read a roster; • the importance of attending work on time; • how to wear uniforms correctly; • knowing that modern awards set pay and conditions; • which cloths and mops to use for cleaning; • the importance of finishing tasks allocated to them; and • communication skills, such as maintaining eye contact, smiling and greeting customers. [197] She said young employees working only a few hours each week took longer to train than older, more experienced people working longer hours. [198] As to training needs and preferences specific to young people, Ms Sharp said: • they increasingly preferred training delivered through short videos; • communicating was a greater challenge for many young people compared to older more mature employees; [2026] FWCFB 75 67 • young people increasingly preferred to communicate through technology, and for that reason McDonald’s had a bot to help with applications and a social media style platform for communication and engagement. [199] Ms Sharp also gave evidence about the breadth of training offered to its employees from age 14 and upwards. She said the goal of the training was to enable them to work safely in the restaurants including commercial kitchens with confidence. She said McDonald’s had a good reputation for the quality of training provided to employees. She said the skills that employees gained were valuable both at McDonald’s and elsewhere. She said an important benefit that McDonald’s recognised and promoted to young employees was that the experience gained while working at McDonald’s helps develop skills for further careers. The ARA’s lay evidence [200] The ARA called evidence from • Ms Fleur Brown, Chief Industry Affairs Officer, ARA;125 • Ms Emma Bridges, General Manager - Operations, Strategy Delivery and Capability within Central Operations, for Coles Supermarkets Australia Pty Ltd;126 and • Ms Belinda Cousens, State Operations Manager – NSW, Kmart Group.127 [201] Ms Bridges and Ms Cousens were cross-examined. [202] Ms Fleur Brown was employed by the ARA as its Chief Industry Affairs Officer. Her evidence was that her colleague Mr Ryan Swenson, the Director Policy & Advocacy, had directed another colleague, Mr Julius Afranie, then employed by the ARA as Policy Advisor – Workplace Relations, to prepare a set of questions for a voluntary survey of ARA and NRA members. She said the link to the survey was distributed to all ARA and NRA members (and some former members). She said the recipient group included small, medium, and large retailers operating across various sectors of the industry. This link had been distributed on 10 June 2025 and was open until 20 June 2025. She said that at the close of the survey period 84 businesses had submitted responses. Ms Brown said the survey responses had been compiled. She annexed a copy of the compiled responses to her witness statement. [203] The SDA objected to Ms Brown’s statement being admitted into the evidence. It referred us to the relevant principles in relation to probative and persuasive survey evidence.128 The ARA argued it ought to be admitted. After hearing from the parties we decided to admit Ms Brown's statement and dismissed the objection, deciding to deal with it as a matter of weight. We now consider the weight that can be given to Ms Brown’s statement. [204] The compiled responses provided responses given to each question by, generally, 86 survey respondents.129 Of the 86 survey respondents that gave the size of their business, 56.98% 125 Exhibit 108. 126 Exhibit 109. 127 Exhibit 110. 128 Referring us to Annual Wage Review 2012-2013 [2013] FWCFB 4000; 235 IR 332, [441]-[442]. 129 while Ms Brown said there were 84 respondents it appears that there were in fact 86. However, the discrepancy is of no particular significance. [2026] FWCFB 75 68 (49) had fewer than twenty employees. More than a quarter of respondents said 41% or more of their total workforce was made up of junior employees. This was the largest plurality in response to the question about workforce proportion. More than a third (31 respondents) said that if junior rates were removed for employees aged 18 to 20, the impact on labour costs would be “severe.” As to how each business would respond if junior rates for employees aged 18 to 20 were removed, the following responses were received (with respondents able to choose all that applied): Reduce junior hiring of that age group, 76.74%, 66 respondents Reduce overall headcount 33.72%, 29 respondents Increase prices 20.93%, 18 respondents Invest in automation/self-service 20.93%, 18 respondents No change 10.47%, 9 respondents Other (please specify),130 10.47%, 9 respondents Total Respondents: 86 [205] For employees aged under 18, the responses to the question of how the business would respond if junior rates were increased, were: Reduce junior hiring of that age group, 75.58%, 65 respondents Reduce overall headcount, 30.23%, 26 respondents Increase prices, 23.26%, 20 respondents Invest in automation/self-service, 19.77%, 17 respondents No change, 16.28%, 14 respondents Other (please specify), 5.81%, 5 respondents Total Respondents: 86 [206] The survey ran to 18 questions. We have treated this survey with caution for the following reasons. • First, there was no evidence of Mr Swenson or Mr Afranie’s qualifications to design or administer a survey. • Next, the number of respondents seemed small compared with the number of ARA and NRA members. The ARA had 6311 members,131 and the NRA had 6413 members.132 This means less than 1% of the two organisations’ membership participated in the survey. We would be reluctant to infer the views of the whole membership from such a small sample. • There was no expert evidence before us as to the adequacy of the sample, the margin of error, what we should make of possible non-response bias in the results if anything, and how the results ought to be interpreted. 130 Various questions allowed a response of “Other (please specify).” If survey respondents did specify what other steps they would take, this was not provided to us. 131 Statement of Ms Brown, Exhibit 108, [7]. 132 PN3603. [2026] FWCFB 75 69 [207] In those circumstances we do not take the survey responses as being representative, or not, of the views of the entirety of the membership of the ARA and/or NRA. The results cannot be generalised beyond the sample. We take the compilation of the survey responses as showing the views of up to 86 retailers, in respect of which no witnesses were made available for cross- examination and whose views must therefore be given limited weight. [208] Beyond this, the SDA submitted that we could infer from the low response rate that most members did not consider the proposed variation to be a big problem.133 This inference would have been open but we do not consider it necessary to draw this inference given the basis on which we have decided this case, and the reasons below. Coles [209] Ms Emma Bridges was General Manager - Operations, Strategy Delivery and Capability within Central Operations, for Coles Supermarkets Australia Pty Ltd. She had been in the role around eight months. Immediately prior to that she had been in the role of General Manager Central Operations for approximately three years. She had a long employment history at Coles having commenced in 1996 as a junior store-based team member. She had been a junior team member until 1998 and then went into a succession of store-based, and then state, regional, and national managerial roles. In her current role she led the development and realisation of group strategies, initiatives and business development opportunities to foster competitiveness and differentiation in the market. She was also responsible for remuneration and workforce planning, including rostering for approximately 110,000 team members across all supermarkets. She was a conduit between retail stores and the Store Support Centre, and was also responsible for Coles Services which encompassed cleaning and trolley services. Effective from mid-July 2025 five roles reported directly to hers, and there were over 8,000 team members within the function for which she had overall responsibility. [210] Ms Bridges said Coles was one of Australia’s leading retailers and had approximately 856 supermarkets located across all Australian States and Territories. She said it also operated an online business, and a liquor business, Coles Liquor. She said as at 23 June 2025 Coles employed approximately 106,199 team members in in-store roles across its supermarkets and liquor stores including Coles Services. In the stores Coles had both waged team members and salaried managers. Those store-based team members who were waged and employed by Coles or Liquorland (Australia) Pty Ltd, and worked in a supermarket or a Coles Liquor store, were covered by the Coles Retail Enterprise Agreement 2024 (Coles Retail EA). The Coles Retail EA was underpinned by the General Retail Industry Award. [211] Ms Bridges said store-based salaried managers may hold the following positions, which were covered by the General Retail Industry Award, and received an annualised salary: (a) Store Manager; (b) Store Support Manager; (c) Department Managers (for example, Dry Goods Managers); and (d) Duty Managers. 133 PN4699. [2026] FWCFB 75 70 [212] Managers led teams of waged team members. Ms Bridges gave a breakdown of the team members and their demographics as at 23 June 2025 as follows:134 Category Numeric data Percentage Engagement type Waged team member: 96,632 Salaried team members; 9,567 Waged team member: 90.99% Salaried team members: 9.01% Waged team members employment type Full time: 6,785 Part time: 54,526 Casual: 35,321 Total: 96,632 Full time: 7.02% Part time: 56.43% Casual: 36.55% Salaried team member employment type: Full time: 9,343 Part time: 224 Total: 9,567 Full time: 97.66% Part time: 2.34% Gender (adult team members) Female: 38,132 Male: 36,547 Gender diverse: 396 Prefer not to say: 203 Female: 50.65% Male: 48.56% Gender diverse: 0.53% Prefer not to say: 0.27% Gender (junior team members) Female: 14,489 Male: 16,154 Gender diverse: 212 Prefer not to say: 75 Female: 46.84% Male: 52.22% Gender diverse: 0.69% Prefer not to say: 0.24% Junior team members (aged 19 to under 20) Full time: 117 Part time: 2,869 Casual: 3,608 Total: 6,549 Full time: 1.79% Part time: 43.81% Casual: 55.09% Junior team members (aged 18 to under 19) Full time: 42 Part time: 2,429 Casual: 4,396 Total: 6,867 Full time: 0.61% Part time: 35.37% Casual: 64.02% Junior team members (aged 17 to under 18) Full time: 7 Part time: 1,772 Casual: 4,205 Total: 5,984 Full time: 0.11% Part time: 29.61% Casual: 70.27% Junior team members (aged 16 to under 17135) Full time: 1 Part time: 1,113 Casual: 2,924 Total: 4,038 Full time: 0.0247% Part time: 27.56% Casual: 72.41% Junior team members (aged 15 to under 16) Full time: 0 Part time: 353 Casual: 1,240 Total: 1,593 Full time: 0 Part time: 22.16% Casual: 77.84% 134 Exhibit 109, [21]. 135 We took the reference to “under 16” in the original table in Ms Bridges’ statement to be a typographical error. [2026] FWCFB 75 71 [213] Ms Bridges said that under clause A3.3 the Coles Retail EA juniors were team members aged under 20 years, and adult rates started at age 20. She said the junior rates under that Agreement were: 19 years, 80.5% 18 years, 71% 17 years, 61% 16 years, 51% Under 16 years, 46.5%. [214] Ms Bridges said the junior rates under the Agreement exceeded the junior rates under the General Retail Industry Award but were less than the rates sought in the application in these proceedings. [215] Ms Bridges said Coles’ age 18 cohort was the largest junior team member cohort employed by Coles, followed by the age 19 cohort. She said Coles did not employ anyone younger than 15. She said junior team members were by and large covered by the Coles Retail EA; as at 23 June 2025, of the 25,076 junior team members, 25,010 were covered by the Coles Retail EA and 66 were covered by the General Retail Industry Award. [216] Ms Bridges said junior team members were engaged to perform a range of roles, most commonly in entry-level customer service and operational support positions. She said the most common was the Store Team Member (Level 1), which included work undertaken across most departments in a supermarket or liquor store related to replenishment activities and customer assistance (amongst other things). She also said Coles pays Customer Service Agents at the relevant adult rate as one of several factors forming part of its retention strategy for this role. She said typically, the majority of Customer Service Agents were aged 20 or above in any event, particularly given the role required at least a 'Green P plates' driver's licence. [217] Ms Bridges said the job at Coles was often their junior employees’ first employment experience. She said that Coles provided entry-level employment opportunities and also invested in young people's development and career enhancement. She said young people often sought employment at Coles' for a chance to gain practical skills as a junior team member. She said they had also found following the pandemic that there was an increasing need for development of social skills and connection, which first employment opportunities assisted in providing. [218] Ms Bridges said Coles predominantly employed junior team members as casuals or part- time employees and that this allowed entry into the workforce in a flexible way that suited them by allowing them to balance work with other important commitments such as education. These engagements also best facilitated compliance with restrictions on work patterns for school-aged children. [219] Citing herself and others in senior management as examples, Ms Bridges said that commencing as a junior team member, before moving into a full-time role and then into managerial roles, was a common career path. [2026] FWCFB 75 72 [220] She said Coles had particular types of roles with minimum recruitment ages but otherwise it did not distinguish according to age when recruiting. The minimum recruitment ages were: Supermarkets, 15+ Coles Liquor, 18+ Coles Services (e.g. trolley collection, cleaning), 16+ Customer Fulfillment Centres, 18+ Services Drivers, 18+ Stocktake Services (count stock in stores), 18+ [221] Coles also ran career weeks with schools and universities, partnered with TAFEs to recruit apprentices, and contacted specific local schools and universities where vacancies arose. [222] As to rostering Ms Bridges said the enterprise agreement provided for a maximum roster period of four weeks. Department managers created rosters and store managers signed off on them. Coles used a task-based labour model, which calculated the number of hours needed to complete a set of tasks. However, where those tasks are performed by a junior team member at a lower pay rate the store may be able to roster additional hours while remaining cost neutral. The cost of engaging junior team members was one of multiple factors that might feed into the overall team mix. The rostering system included the store’s desired hours and team members’ available hours preferences, and there were also controls in relation to child employment, both to comply with legislative requirements and where Coles had made a decision to apply some jurisdictions’ requirements nationally, by prohibiting stores from rostering 15- to 17-year-old team members between 10 pm and 6 am. [223] As to work value, Ms Bridges said generally the formal duties or tasks performed by a team member pursuant to a particular classification may not differ depending on whether that team member was a junior team member or adult team member (other than where there are particular restrictions), but this did not mean that they provided the same work output. She said junior team members employed as a Store Team Member (Level 1) were most likely to be rostered in the service area of a store (including registers and customer service) or in replenishment (such as dry goods, fresh produce restocking). She said certain roles and tasks could not be performed by junior team members, particularly aged under 18. She said they could not or were unlikely to: (a) work in Coles Liquor or sell tobacco; (b) hold any supervisory role (e.g. Department manager); (c) perform certain work in some jurisdictions such as delivery of click and collect orders to car boots (as this required supervision); (d) use certain equipment in some departments such as butchers’ knives. [224] She also said there were informal practices relating to task allocation. For example it was unlikely that a junior team member, particularly a person under age 18, would be asked to do the shopping or picking part of a delivery or a click and collect order, because they may not possess the necessary judgement or skill to select substitutes and may not have the attention to detail for selecting fresh produce. For replenishment work Ms Bridges said managers were more likely to allocate junior team members to replenish bulky items such as toilet paper, bottled drinks, or packets of biscuits, but were less likely to have them replenish other products where [2026] FWCFB 75 73 a high level of attention to detail and patience was required. She gave the example of the health and beauty aisle. [225] Ms Bridges also said that junior employees were often not equipped to answer certain product-related or policy-based questions because of limited experience or life exposure, so they often referred customer questions to a supervisor or customer service manager. [226] As to team members aged 18 and over, Ms Bridges said they performed similar duties to adult team members, but team members aged 21 and over tended to bring greater responsibility, life experience, emotional intelligence and maturity to their work, and could guide younger team members. [227] Ms Bridges said junior team members often had limited availability. Their periods of greater availability often coincided with Coles’ periods of greater need (e.g. weekends, Christmas, and Easter) but sometimes did not. For example, Coles may prefer replenishment to be done overnight but junior employees’ availability would be afternoon to evening. She said such commercial considerations were specific to the engagement of junior employees. She also said Coles store managers often had to interact with employees’ parents, which took time and reduced productivity. [228] As to cost impacts if the application was granted, Ms Bridges anticipated that there would be a 25.5% increase in wages costs for the 18-year-old cohort and a 16.68% increase in wages costs for the 19-year-old cohort. This would have a material impact on Coles’ cost per hour rate metrics. Wages were Coles’ second biggest expense after the cost of purchasing goods for sale. Though it was difficult to say with precision what Coles’ response would be if the application was granted, one likely outcome would be a reduction in hours for junior team members and a reduction in first employment opportunities for young people. Coles would also consider further automation and process efficiencies which could lead to an overall loss of hours. Kmart Group (Kmart and Target) [229] Ms Belinda Cousens was employed by Kmart Australia Limited as State Operations Manager – NSW and made her statement on behalf of Kmart Group (which comprised both Kmart Australia Limited and Target Australia Pty Ltd). Since 2024 her role had included Target stores in NSW and the ACT. Ms Cousens had been employed by Kmart for over 25 years, having originally commenced in 1998 as an adult seeking flexible employment. [230] Kmart Group operated 419 retail stores across Australia as at January 2025. Ms Cousens gave the following breakdown of the workforce:136 Category Numeric data Percentage (of each category in each row) Engagement type Waged team member: 43,809 Salaried team member: 2,359 Total: 46,168 Waged team member: 94.9% Salaried team member: 5.1% Total: 100% 136 Exhibit 110, [10]. [2026] FWCFB 75 74 Category Numeric data Percentage (of each category in each row) Waged team member employment type Full time: 729 Part time: 7,356 Casual: 35,724 Total: 43,809 Full time: 1.7% Part time: 16.8% Casual: 81.5% Total: 100% Salaried team member employment type Full time: 2,174 Part time: 185 Casual: 0 Total: 2,359 Full time: 92% Part time: 8% Total: 100% Junior team members (aged 19) Full time: 9 Part time: 175 Casual: 3,961 Total: 4,145 Full time: 0.22% Part time: 4.22% Casual: 95.56% Junior team members (aged 18) Full time: 3 Part time: 123 Casual: 5,932 Total: 6,058 Full time: 0.05% Part time: 2.03% Casual: 97.92% Junior team members (aged 17) Full time: 0 Part time: 17 Casual: 6,785 Total: 6,802 Full time: 0 Part time: 0.25% Casual: 99.75% Junior team members (aged 16) Full time: 0 Part time: 4 Casual: 4,958 Total: 4,962 Full time: 0 Part time: 0.08% Casual: 99.92% Junior team members (aged 15 or under) Full time: 0 Part time: 1 Casual: 2,534 Total: 2,535 Full time: 0 Part time: 0.04% Casual: 99.96% [231] She said store-based team members were engaged under the Kmart National Agreement 2024, the Target Australia Retail Agreement 2022, or the General Retail Industry Award. Generally, store-based waged team members were engaged under one of those two enterprise agreements. Waged team members were typically employed in the position of Retail Assistant at Kmart or Customer Service Assistant at Target. Ms Cousens considered each of these roles were equivalent to the classification Retail Employee Level 1 under the General Retail Industry Award. Salaried team members in stores were typically employed in supervisory or managerial roles and paid annualised salaries. [232] Ms Cousens said the Retail Assistant and Customer Service Assistant roles typically include performing in-store tasks such as customer service, point-of-sale operation, merchandise replenishment and inventory, and maintaining store presentation. She said these employees greeted customers, helped them find products, processed sales transactions, restocked shelves, and handled general customer inquiries on the store floor. Additionally, they might be involved in visual merchandising and general store upkeep. [2026] FWCFB 75 75 [233] Team members 20 years old or older were paid the full adult rate under each of the Target and Kmart enterprise agreements. Junior rates for Customer Service Assistants under the Target enterprise agreement were: 19 years, 80% 18 years, 70% 17 years, 60% 16 years and under, 50% [234] Junior rates for Retail Assistants or Ride-on Trolley Collectors aged 19 or younger at Kmart varied according to the time of day. Hours worked between 7 am to 6 pm Monday to Friday were the same percentages as under the General Retail Industry Award, but applied to the adult rates under the Kmart enterprise agreement. Hours worked outside those times were paid according to the junior rates set out in Schedule B.3 of the General Retail Industry Award plus 1 cent per hour. [235] Team members aged under 20, who were required to work as a Clerical Administrator, Assistant Supervisor, or Supervisor, were paid the full adult rate as provided by the Kmart enterprise agreement. [236] Ms Cousens said recruitment decisions were based on operation needs not age. At the same time, Kmart Group wanted to provide entry-level opportunities. They did not provide unpaid “work experience” opportunities but instead encouraged expressions of interest in paid employment. They did not have a formal or organisation-wide recruitment strategy specifically targeted at junior candidates, but their processes naturally attracted candidates aged 15 to 20, because their roles were entry-level and flexible. Also, some store managers might take informal steps to promote job opportunities to young candidates, including by engaging with nearby schools. In addition, their Indigenous outreach and employment program included a focus on First Nations youth. She said Aboriginal and Torres Strait Islander peoples represented more than 4% of the Kmart Group’s store-based team members in Australia, of which 62.73% (being, approximately 1,400 team members) were under the age of 20. [237] Kmart Group also had to comply with child employment restrictions. They had a practice of requiring written consent from a parent or guardian before employing someone aged 16 years or younger. [238] Kmart group provided career advancement and saw young workers as a talent pipeline. Ms Cousens gave examples of people whose career progression with Kmart Group started with employment as a junior. She also provided information about training arrangements at Kmart Group, and rostering practices. They did not roster school-aged employees on before or during school hours. In addition to availability, rosters took into account supervision requirements. Ms Cousens said junior team members took time to build confidence on the shop floor and might require more day-to-day guidance, especially during initial shifts. Supervision assisted junior team members to gain confidence, remain productive, and work safely. As to the latter Ms Cousens referred to the operational area of decanting, which involved manual handling. She said store managers ensured junior employees doing this work were adequately supervised to promote safe practices and effective performance. [2026] FWCFB 75 76 [239] Ms Cousens said Kmart generally did not roster junior team members to certain customer-facing duties such as the Service Desk or Customer Greeter positions. However, she also said they aimed for the Customer Greeter role to be performed by employees above the age of 18 and that in Tasmania there was a requirement that Customer Greeters be aged at least 18. She then said workers under 18 in other states could also be deemed competent to perform the role based on a ‘License to Greet’ process. This seems to imply that Kmart Customer Greeters could generally be junior employees who are young adults, and could also sometimes be junior employees who were minors. Ms Cousens also said a junior employee could work on the Service Desk, “particularly one who demonstrates maturity, in the sense of evidenced professionalism, a strong work ethic and are trustworthy, or has longer tenure with the business…”.137 [240] Ms Cousens said that generally employees aged 20 or older were more likely to be rostered to do work involving cash handling, administrative duties, visual merchandising window changes, and other supervisory roles. As indicated above, junior employees in supervisory roles were paid adult rates, and Ms Cousens said this was the case at both Kmart and Target. [241] As to task allocation Ms Cousens said Kmart did not have any explicit instructions or guidance or restrictions about what tasks could be assigned to employees aged under 20. However, intuitively or through retail experience store managers tended to use junior employees for some tasks but not others. That was particularly where a level of maturity and professionalism, or a degree of experience and confidence, was required. [242] Ms Cousens said each store had a wages budget. If the average hourly rate increased it was likely there would be fewer total hours available to allocate across casual store team members. She said this would mean fewer casual employees would be rostered to work, and fewer total shifts would be offered. She said if all casuals were paid the same rate they would need to revisit rostering structures and possibly reduce headcount. She said if they had to pay adult rates to all team members they would likely employ and roster more shifts with adult team members, and hire fewer junior team members. They would need to consider efficiencies including how they staff the shop floor. They would need to prioritise rostering business-critical roles such as those in back-of-house operations or supervisory coverage. Customer interaction roles might be scaled back. This could reduce visible staff presence, affecting customer services and the number of available shifts. MGA lay evidence [243] The MGA led evidence from three witnesses,138 one liquor store operator, Mr Anthony Bongiovanni,139 and two operators of independent grocers, Ms Slavka Koch,140 and Mr Bruce Luchterhand.141 Mr Bongiovanni’s store was in Gisborne, Ms Koch’s stores were each around 137 Exhibit 110, statement of Ms Cousens, [54]. 138 Though a statement was filed for an additional witness, that witness withdrew and the statement concerned was not tendered. 139 Exhibit 118. 140 Exhibit 74. 141 Exhibit 117. [2026] FWCFB 75 77 three hours’ drive from Adelaide, and Mr Luchterhand’s store was on the Sunshine Coast. All were cross-examined. Liquor [244] Mr Anthony Bongiovanni was a Director of Grogbusters Pty Ltd and was responsible for the retail operations of one independent liquor store trading under the Cellarbrations banner. The store was located in Gisborne, Victoria. Mr Bongiovanni had owned and operated Cellarbrations Gisborne since 2007. He had managed and owned several liquor stores over forty-five years. Mr Bongiovanni paid his staff according to the General Retail Industry Award. He employed two juniors at the time of his statement and had employed over fifteen since 2007. As a liquor store, Mr Bongiovanni’s business’s employees had to be aged at least 18. The juniors he employed were between the ages of 18 and 21. Mr Bongiovanni said for most eighteen year olds it took around two years of working under the supervision of a senior employee to be able to work independently and without supervision. By that stage they were entitled or close to being entitled to the full adult rate because they were aged 20 and had usually been employed by the business more than six months. [245] Mr Bongiovanni said juniors’ practical skills and experience were not as developed as those of a senior employee who had been in the workforce some time. He said he found the differences between his junior and senior employees were mainly in regard to product knowledge, customer service, and attention to detail. He said junior employees understandably did not have the same product knowledge compared to senior employees as they had not had the same exposure and time to familiarise themselves with subtle product differences. He gave the example of when a customer comes into the store asking for a wine recommendation and said he found a senior employee was almost always able to provide a more satisfying customer experience by providing expert advice. He considered the senior employee should be rewarded with a higher rate of pay. [246] As to customer service, Mr Bongiovanni said much of the shopping experience was built on staff being friendly and approachable, and taking an interest in the customer and their liquor preferences. He said almost all junior employees lacked customer service experience, and that those without that experience lacked the confidence to interact with customers and provide them with the level of advice and expertise expected in his business. He said on some occasions he had observed that junior employees did not even greet customers when they entered the store. He said they initially saw their role as no more than a payment terminal operator and not a person who customers relied on to make a product selection in what can feel like an overwhelming environment. He said senior employees that he had engaged in the business were usually more willing to enthusiastically greet customers build personal relationships with local customers and get to know their preferences. He said this type of customer service experience was what differentiated his business from others and assisted him in attracting and retaining consumers. He said these types of interactions positively contributed to the reputation of his business. [247] Mr Bongiovanni said junior employees did not have the same level of engagement in their employment as senior employees and did not have the same level of attention to detail. He said this meant that they often made a greater number of errors. He gave an example of junior employees selling on barcoded bottles of wine as a different bottle of wine with the same brand [2026] FWCFB 75 78 name but slight variations in either the vintage or grape variety. He said such bottles could have a price difference of over $100 and that this cost difference became a loss for the business. He said a senior employee would not make the same mistake as their product knowledge and experience was more advanced. [248] Mr Bongiovanni said that if the application was granted he would consider changing the age mix of his workforce. Instead of hiring junior employees it was likely he would hire more senior candidates with greater experience in the liquor industry and the workforce generally. They had more to offer and would not make as many simple mistakes. [249] Mr Bongiovanni said that if businesses hired senior job candidates in preference to junior candidates young adults would find it more difficult to get their start in the workforce. He said this meant that many young people would not be able to develop the fundamental life skills associated with early employment. He said this would be detrimental to young people who would become less attractive to prospective employers not only in the retail or liquor industry but in the workforce generally. He said he had had many impressive young adults enter the workforce through his business who had gone on to become qualified in other fields and take up jobs in management. He said he was passionate about providing young people in his community with an opportunity to learn important life skills and get on-the-job experience and was concerned that if the application was successful he would no longer be able to viably provide this opportunity. Mr Bongiovanni was concerned that if the application were to be successful that would cause tension in the workplace because older employees would be offended if they were being paid the same as someone who had just entered the workforce. He considered this would lead to a drop in morale and affect his employees’ ability to provide an exceptional standard of customer service. Independent supermarkets [250] Ms Slavka Koch was a director of two proprietary companies and operated two independent supermarkets trading under the Foodland banner. She had over thirty years’ experience in the retail supermarket industry. Staff in her supermarkets were paid according to the General Retail Industry Award. She said her supermarkets employed approximately 40 junior employees across both stores at any one time. Both her supermarkets were around three hours’ drive from Adelaide. She said by the time junior employees reached 18 years of age they typically left the area to pursue tertiary education in more urban areas. Otherwise, young people in the relevant communities opted to start their own business or commence a trade. She said as a result their juniors were aged under 18. [251] Ms Koch gave evidence as to the training provided to junior employees. She said her stores were heavily focussed on servicing the specific needs of the community and providing a personalised service as their point of difference. She said junior employees were encouraged to use their initiative and assist in determining what worked best in their store, for example by rearranging a display to highlight a product, or by creating a small themed display. She said although junior employees were provided with comprehensive training and guidance they needed constant supervision as their social and analytical skills were not developed to a point where they could work independently. She said that meant that when they rostered a junior to work they needed to also roster a senior employee and be aware that the latter’s productivity [2026] FWCFB 75 79 may be affected by having to devote time to supervising junior employees. She said a significant time investment was needed, and paying junior rates made that a viable option. [252] Ms Koch said their juniors were employed to perform the basic duties of a retail assistant, such as working the register and stocking shelves. She said they did not perform to the same standard, nor as efficiently, as adult employees, and that having regard to their relative inexperience this was reasonable and expected. Ms Koch said junior employees generally did not have the same level of attention to detail or engagement compared with an adult employee. She said adult employees were working to support their families and earn a livelihood while juniors were working to gain experience and for pocket money, so the stakes were lower for junior employees, leading them to have lower accountability for their work. She said they were less engaged and invested and were content with performing the bare minimum. She said the difference in commitment and lack of attention to detail resulted in juniors making more errors that adult employees. She said adult employees were more reliable than junior employees who had different priorities including schooling, sport, and a busy social life. These matters also affected junior employees’ availability for work which made rostering them difficult. She said if the application were granted it would not be worth paying a junior employee who was less reliable a rate equivalent to that of an adult who is reliable. [253] Ms Koch said her stores faced fierce competition from major supermarket retailers. She said historically wages had been 9% of her stores’ turnover but were now approximately 11% of the turnover. She said if the wages costs went up she would consider: • reducing and reconfiguring staffing levels and rosters to minimise expenditure on wages; or • increasing the prices of products sold in both stores. [254] She considered the former more realistic to avoid pricing her stores out of the market. She said to change the staffing mix she would likely engage fewer junior employees and prioritise adult employees. She considered she would be able to hire one adult to replace two juniors, because of adult workers’ greater productivity. Ms Koch also gave her views on potential social consequences of fewer job opportunities in regional communities. [255] Mr Bruce Luchterhand was a Director of a proprietary company trading as The Alex Pantry, an independent supermarket in Queensland. He also paid staff according to the General Retail Industry Award. He currently had ten employees aged under 21, and had employed over 70 junior employees in the preceding nine years. He said in most cases this was the junior employee’s first job. [256] Mr Luchterhand said all of his junior employees had been hired before the age of 18, and had yet to acquire retail specific mature problem-solving skills, appreciation of risk, and use of initiative. He considered those skills developed as someone aged and had the benefit of life experience, workplace mentoring, and training. [257] He said he invested a lot of time in training junior employees, and parents and teachers told him that the employees had come out of their shell and their social skills had developed since working at the Alex Pantry. He said he did not receive the same efficiency and productivity from those workers compared to older employees, and the cost trade-off was that they paid junior rates commensurate with the employees’ age. He said the overall difference he [2026] FWCFB 75 80 had seen between junior and adult employees in his business was the level of maturity, initiative, and care they displayed. He said he always rostered on himself, his brother-in-law, his wife, or another adult employee to supervise junior employees because there were many customer service situations junior employees were unable to handle autonomously and safely, and because there were tasks consistently performed to a lower standard by junior employees. He gave the following examples of tasks he was unable to assign to a junior employee until they were fully trained: • Being alone in the store; • Selling cigarettes or tobacco products, and they were required by law not to allow employees aged under 18 to sell these products; • Making sandwiches or peeling the chicken for sandwiches, as their lack of attention to detail could result in bones being left in the chicken; • Sweeping, mopping, cleaning equipment, cleaning slicers and combi ovens, washing up knives. [258] Mr Luchterhand said junior employees lacked life experience, and social and analytical skills. He said he worked 100 to 110 hours per week, his brother-in-law worked approximately 45 hours per week, and his wife worked approximately 25 hours per week plus additional administrative work at home. He said these hours were necessary to properly supervise junior employees and make sure the business operated effectively. Mr Luchterhand gave a rough estimate that if the application were to be granted the additional wage cost to his business would be $21,150.22 per year, or an increase of 12 to 20%, not offset by any productivity improvement. He said he would need to consider closing his business. Mr Luchterhand also gave his views on potential social consequences if the application were to be granted. Pharmacy Guild lay evidence [259] The Pharmacy Guild called evidence from the following people, all of whom were cross-examined save for Mr King: • Ms Amanda Chisholm, Group General Manager of a firm with nine community pharmacies located across South Australia, the Northern Territory, Tasmania, and Queensland, who also had previous experience in human resources in manufacturing and retail;142 • Ms Jessica Knight, Human Resources Partner for a network of seven community pharmacies located in Far North Queensland;143 • Mr Robert King, a pharmacist and proprietor of five TerryWhite Chemmart pharmacies, in New South Wales and South Australia;144 • Mr Quinn On, a pharmacist and proprietor of three pharmacies in New South Wales, who also assisted in the management of two other pharmacies;145 142 Exhibit 114. 143 Exhibit 111. 144 Exhibit 116. 145 Exhibit 113. [2026] FWCFB 75 81 • Mr Wisam Zoghbi, pharmacist and a proprietor of four pharmacies in New South Wales;146 and • Ms Vaneeta Kennedy, a pharmacist and a partner of two community pharmacies in New South Wales.147 [260] Ms Chisholm said as at 2025 her employer currently employed 27 junior employees across their nine pharmacies. That number had varied in preceding years, from 18 in 2020 and 2021, to 31 in 2022, 37 in 2023, and 32 in 2024. Of the current junior employees the age breakdown was:148 Aged 14 0 Aged 15 3 Aged 16 2 Aged 17 7 Aged 18 3 Aged 19 8 Aged 20 4 [261] That year junior employees represented 18% of the employer’s workforce. Over the past decade the proportion had been 25% on average. Ms Chisholm said they employed juniors predominantly as casuals to provide supplementary labour, to have a reliable and flexible workforce. She said junior employment introduced them to the workforce which created a talent pipeline for future pharmacy assistants or other roles within the business. She said providing youth employment opportunities also benefited the community. Junior employees assisted them to provide service coverage; most of the pharmacies were open seven days a week, 8.30 am to 9.00 pm. Ms Chisholm also said junior employees assisted senior employees and helped reduce staffing costs. [262] Ms Chisholm said there was little if any variance in the responsibilities expected of junior employees, but there was higher tolerance for mistakes, and an expectation that customer questions would be referred to more senior staff. [263] She said because for many junior employees the job at the pharmacy was their first job, they required close supervision. The younger they were the more supervision required, typically. They began with simple tasks. As well as learning how to do tasks they were taught fundamental workplace expectations such as punctuality, dress standards, refraining from mobile phone use during shifts, and using initiative on the job. Many were unfamiliar with these expectations so their productivity was initially lower. Junior employees often required more support and encouragement to maintain engagement and productivity than older employees. They did not have the same level of awareness of customers. [264] She said all employees including juniors had to complete S2/S3 training which covers the supply of pharmacy-only and pharmacist-only medicines. All newly-onboarded employees 146 Exhibit 112. 147 Exhibit 115. 148 Exhibit 114, [13]. [2026] FWCFB 75 82 required training but employees with no previous work experience required additional training. Often juniors fell into this second category. [265] Ms Chisholm said the retention rate of junior staff was lower than that for mature age workers: approximately three years, compared with 4.5 years. Juniors mostly worked with them until they finished study, though some pursued a career in pharmacy. [266] Ms Chisholm said if junior rates were increased or removed from the Award they would be significantly less likely to employ junior staff or as many junior staff. They would hire older workers instead. [267] Mr King said he currently employed 22 junior employees across his five pharmacies. The majority were aged between 16 and 18. Most were still in high school. The vast majority were employed as casuals. They employed juniors to balance their workforce from a resourcing, availability and wages cost perspective. He considered a benefit of junior employees was that they did not have any pre-existing behaviours from other workplaces. He said they tended to fill afternoon and weekend shifts, unless full-time or part-time, in which case it was common for them to work full day shifts. [268] He said casual junior employees tended to have reliability and commitment issues. He said as junior employees became more experienced they became more capable of performing their duties effectively. This could lead to juniors being entrusted with duties such as assisting the Pharmacist with opening or closing the store. He said a lack of life experience was a limitation on junior employees’ training potential. He said he had had some employees aged 17 and 18 as Level 3 pharmacy assistants but there was a large capability gap between them and those over the age of 21. They still had poor product knowledge, and patients were reluctant to speak with them for advice. Generally, age was a factor in confidence, which Mr King saw as connected with the lack of life experience. [269] As to duties Mr King said junior employees started with more menial or basic duties. There was not a large variance in duties based on age but there could be a difference in their capability and performance. The variance was tied to level of experience and commitment to work. He gave the example of one junior team member who had worked for him since they were 15 years old and now, they were 19 years old and far more capable than other 19-year- olds who had just started working for him. He said some juniors who had worked for him for a long period were given responsibilities requiring more experience and skills. This was determined according to training, maturity, and experience. [270] Mr King said junior employees needed much more direction than mature employees. Store managers provided this direction. They also provided day-to-day and ad hoc training. Junior employees were more closely supervised. Junior employees generally took longer to train because they needed to be taught more basic skills that more senior or mature employees already had. The learning curve was steeper for junior employees. [271] There was a higher turnover of junior employees than senior employees, linked to their different stages in life. [2026] FWCFB 75 83 [272] If the application was granted junior candidates would be at significant disadvantage compared with more mature candidates. The higher cost of training and supervision would no longer be offset by junior rates. His pharmacies would be less inclined to hire junior employees. If the choice came down to an 18-year-old straight out of school and a 25-year-old who had worked before, they would choose the latter. If wages costs increased he would consider reducing opening hours especially during periods where penalty rates were payable. [273] Ms Knight estimated that her employer employed fifteen to twenty junior employees across its seven pharmacies. She said they employed juniors for flexibility, adding a buffer to their rosters, reduced cost, and creating a funnel for young kids who wanted to pursue a career in pharmacy. [274] She said junior employees wanted to work shifts according to school and university availability constraints. This meant junior employees mostly worked in quieter periods. Her employer primarily employed junior employees to work an average of six to twelve hours per week but they were shifting to more casual employment due to juniors’ availability being unpredictable. Shifts were usually 3 hours during the week. Employees aged over 16 could work a full day on weekends. They were usually reliant on their parents, restricting their availability. [275] Full-time juniors naturally gained more experience than those working part time. There were differences as between the duties of full-time and part-time team members. [276] Junior employees generally had less confidence. The employee’s age also affected the scope of their duties with a 16-year-old employee not being able to work in first aid, diabetes, or dispensary sections as these required a lot of product knowledge. Junior employees who were inexperienced would be restricted to restocking shelves or working on the register. [277] There was a greater learning curve for junior employees compared with employees over the age of 21. Junior employees rarely commenced with them with any work experience or transferable skills. For many, working in the pharmacy was their first job. Employees over the age of 21 usually had some work experience and maturity, allowing them to take on more responsibility and show more initiative. Junior employees required more performance management. [278] Ms Knight said all junior employees performed up to sixty percent of the duties covered by their classification level. Junior employees were unable to respond to other stores and assist, especially with the movement of stock, which was a Level 1 task. Junior employees would be unlikely to be capable of receiving stock. On the other hand, junior employees with previous work experience or who had worked with these pharmacies for longer would be able to complete a broader range of duties. [279] All new employees required supervision during onboarding. This went on for longer with junior employees. The amount of onboarding and training required differed between people who were working longer and shorter hours. On-the-job training and ad hoc training generally took longer with junior employees. [2026] FWCFB 75 84 [280] The rate of turnover was higher for junior employees, with quite a few who did not pass their probation period. Many moved away after high school or university. [281] Ms Knight said if the cost of hiring 16- or 17-year-olds substantially increased there would be a reduction in hiring for these ages, and they would hire 21-year-olds instead. There would be little impact on the business’s willingness to engage full-time employees, particularly those over the age of 18 as they would hope they would become long-term employees and they would hope for a return on investment even though an 18-year-old school leaver did not have the same immediate productivity value as an employee aged 21 or more with greater work and life experience. They would likely reduce the number of those over the age of 18 they employed on a part-time basis who did not have an interest in a career in the pharmacy or medical profession. They would look to employ more mature workers instead. [282] Mr On had worked in community pharmacy since 1992 and had purchased his first pharmacy in 1994. He currently employed 34 junior employees:149 14 years 1 15 years 4 16 years 11 17 years 3 18 years 6 19 years 6 20 years 3 [283] 31 were casuals, one was part time and two were full time. Twenty were still in high school, two were trainees, 11 were studying at TAFE or university and one was a school leaver. For most, particularly those aged under 16, this was their first work experience. He encouraged junior employees seeking full time employment to pursue a Certificate III. He paid them higher than trainee wages to encourage them to finish as quickly as possible. On completion they received the Level 3 adult rate. [284] Mr On’s reasons for employing juniors included that they provided good support, had a reduced cost, and provided a great way to connect with the local community. He said many parents who were customers encouraged their kids to apply for work in the pharmacy. Local schools approached him. Parents and schools saw a first job in pharmacy as a superior alternative to general retail and hospitality. He said junior employees had desirable availability because the periods they wanted to work were less sought after by mature employees. Hiring juniors helped make sure these shifts could be filled. He liked employing junior employees to contribute to their professional education. He enjoyed being part of their development and success. He considered junior rates allowed him to take a chance on people. [285] Mr On gave evidence as to his experience with junior employees’ availability. He said they had greater reliability issues than mature age team members. He said they lacked life experience and work experience. They were unfamiliar with the general requirements of being an employee. As to duties, he said they were given tasks that were more process driven. There was some variance in the duties expected of them, largely dependent on age, maturity, and how 149 Exhibit 113, [14]. [2026] FWCFB 75 85 frequently they worked. For example, an 18-year-old full-time employee was easier to train than a casual employee; a lack of continuity in training prevented the pharmacy from giving high-level skilled tasks to many junior employees. Tasks related to reordering stock would be unlikely to be given to a junior staff member. In rare circumstances, with a very intelligent and mature 18-year-old, who was eager to learn, they might provide training to assist with webster packs. [286] Mr On said they had had performance issues with junior employees who liked to chat. He said junior employees treated their employment as spare cash rather than income they relied on, so they tended to need more supervision. Surveillance had shown that when junior members were not properly supervised some would simply stand around, draw pictures, or write poetry. The greater supervision cost and reduced productivity was offset by junior rates. [287] Mr On gave evidence regarding the training provided to all employees. He considered junior employees took longer to train. They also needed more elaborate and detailed explanations because of the lack of previous life or work experience. They required guidance on essential interpersonal and operational skills. [288] Mr On said there would be a higher turnover rate for junior employees than mature age employees. The reduced retention was offset by junior rates. [289] He said if the application was granted, wage expenses would be higher. He would look for ways to maintain current profit margins. He would review existing closing times. His pharmacies were less likely to stay open longer hours or at times when penalty rates were payable. If required to pay the same rates he would prefer someone with better life experience. He would still seek to employ full-time employees regardless of age given how difficult it was to find full-time employees or those who wanted to work in the pharmacy profession. [290] Ms Kennedy had worked in community pharmacy since she was a second-year pharmacy student in 1993. She employed approximately ten junior employees across her two pharmacies. Most were aged 17 or 18, still in high school, and employed as casuals. She employed two juniors as trainees, one for a Certificate III who would move to the Level 3 adult rate once she had completed that qualification. [291] Ms Kennedy said employing junior employees helped accommodate older employees who were not available after school hours, and to have an appropriate balance of experience on the roster. [292] Ms Kennedy explained working hours arrangements at her pharmacies, and her general experience with junior employees’ availability, reliability, and commitment. She said their aptitude depended on the individual. She said pharmacy required a level of product knowledge and emotional intelligence different from general retail. She said junior employees tended to have less compassion, empathy and emotional intelligence compared to older staff. She said junior employees often had less capacity to accept constructive feedback than older employees. [293] She said junior employees tended to work mostly on registers, and would also be involved in ticketing shelves, general cleaning, and topping up displays, under supervision. They might also put stock away, and would also fill up stock from drawers and have a general [2026] FWCFB 75 86 presence on the pharmacy floor. Older employees had the same scope of duties but would perform better and with less supervision. Full-time junior employees might have more responsibilities by reason of their experience in the pharmacy. [294] Ms Kennedy said junior employees needed more supervision and were never left without some level of supervision and managerial support. She said junior employees tended to require more training at the start of their employment than older employees; they needed training about the job and also how to manage and conduct themselves in the workplace. She said some junior employees were enthusiastic about ongoing training and others might not put in the effort. She said there was a difference in retention between junior employees and older employees but she did not provide any estimates of average length of tenure. She said there was a risk that junior employees would leave eventually, especially once they finished high school or university. [295] Ms Kennedy also gave some evidence about two of the SDA’s witnesses who had worked in one of the pharmacies of which Ms Kennedy had been a joint owner. [296] Ms Kennedy said if the application was granted she would be less inclined to employ junior team members, and would be less inclined to employ a 19-year-old who had no work experience compared to a 30-year-old candidate who had an employment history and demonstrated a level of commitment and reliability. She said she may also need to review her pharmacies’ opening hours. [297] Mr Wisam Zoghbi said he employed junior employees to assist with staffing the roster, saying junior employees were available to work later shifts and on weekends when more senior staff were unlikely to be available, and when the pharmacies were quieter. He said his pharmacies also employed juniors to give local kids their first job. He said it was more cost effective to roster junior employees during times when penalty rates applied. Mr Zoghbi referred to constraints on availability and rostering, including because of education commitments and whether the employee was engaged on a casual, part-time or full-time basis. [298] Mr Zoghbi said junior employees had varying attitudes to work, which could be affected by their education, family, and work ethic. He said many had a lower desire to upskill or learn new concepts. He said generally senior employees were more committed, and junior employees generally had greater attendance and reliability issues and greater reliance on parents. He said junior employees generally had a much lower level of emotional intelligence as a result of having less life experience, and this could mean they had less empathy and confidence. As a result of having no or less life and work experience junior employees required a lot of one-on- one management and training. [299] Mr Zoghbi said junior employees were generally given tasks that did not require a high level of responsibility or any qualification. Duties included cleaning, stock fills, assisting with merchandise, sorting mail and doing a mail run, and staffing checkouts. He said some junior employees were hesitant to approach customers, but that was expected. He said some junior employees may assist with taking in a prescription or handing out prescribed medicines but only under a high level of supervision. He said some rare junior employees were very switched on, smart, adaptive and eager to upskill and show initiative. In those cases they were trained to take on more duties and responsibilities but only under a higher-level supervision than a more [2026] FWCFB 75 87 senior employee would need. He said duties not expected of junior employees included supervision, training others, counselling customers, and providing general advice on products, common health issues, and first aid. [300] He said new junior employees underwent orientation with a manager and were coupled with a senior team member for at least three weeks, whereas others also underwent orientation with a manager for approximately one week. He said his pharmacies did not intensely supervise junior employees because they provided them with duties that were as light as possible. Any customer-facing tasks were undertaken with heavy supervision. He said junior employees took 2 to 3 years to be fully upskilled and trained, and they learned slower than older employees. He said they also provided some training specifically for juniors. There was also ongoing training for all staff, though juniors aged under 16 were not required to complete it. [301] Mr Zoghbi said there was a higher turnover of junior employees than senior employees, though no estimates of tenure were provided. He attributed this higher turnover to work ethic, maturity, absence of reliance on the pay to support themselves, and the nature of first jobs as a stepping stone. [302] Mr Zoghbi said if the application was granted, he would be less inclined to employ younger people. Given the same wage, he would prefer to employ someone with more work and life experience, and capability. They would be less inclined to commit to training young people if the wage cost increased. Mr Zoghbi also responded to evidence given by one of the SDA’s witnesses. SDA’s lay evidence in reply [303] The SDA’s reply materials were filed in August 2025. • BB gave a statement in reply to Ms Johnston and Mr Morton’s statements.150 • BC, who was cross-examined as indicated above, had given a statement replying to the statements of Ms Kennedy and Mr Zoghbi.151 • SM’s witness statement in reply responded to the statements of Ms Wallace-Hughes and Ms Johnston.152 • SL’s witness statement in reply responded to the statement of Ms Bridges.153 • DM’s witness statement in reply responded to the statement of Mr Humphreys.154 150 Exhibit 21. 151 Exhibit 11. 152 Exhibit 55. 153 Exhibit 48. 154 Exhibit 59. [2026] FWCFB 75 88 • KP, who was also cross-examined, gave a witness statement in reply that responded to Ms Kennedy’s statement.155 Expert evidence [304] We will now summarise the parties’ expert evidence. We have further referred to their evidence to the extent necessary below. All of the expert witnesses were made available for cross-examination. [305] As indicated above the SDA called evidence from two expert witnesses: Professor Jeff Borland, Truby Williams Professor of Economics at the University of Melbourne, and Professor Martin O’Brien, the Director of Centre for Human and Social Capital Research at the University of Wollongong. [306] Prof Borland’s report of 6 November 2024 (“the Borland principal report”)156 provided an overview of relevant theory, a review of relevant literature, and opinions in respect of the changes to each of the three modern awards the subject of these proceedings. The theory section of the Borland principal report went to “an overview of the ways in which a labour market can potentially adjust following an increase in a minimum wage rate,” and then used that overview “to describe the theory relating to how an increase in a minimum wage rate can affect employment, costs of employment, and the national economy.”157 The literature review considered literature as relevant to the impact of changes to minimum wages generally, and, where available, changes to youth rates, on labour costs, employment, and national economic performance. In the sections in which Prof Borland provided opinions as to each of the awards, he considered employers’ costs, impacts on employment, and impacts on national economic performance. Professor Borland also set out assumptions, caveats and limitations, as well as providing a reference list and other supporting material. [307] After receiving the Borland principal report, Ai Group sought further information in relation to it. In response Prof Borland provided a supplementary report of 13 May 2025 (“the Borland supplementary report”)158 with an accompanying spreadsheet file. The Borland supplementary report included responses regarding literature, calculations, and various questions raised by Ai Group, along with an explanation of the spreadsheet file. [308] Prof O’Brien provided a report of 16 October 2024159 (“the O’Brien principal report”) which provided quantitative and statistical information, in relation to the characteristics of employees and businesses covered by the three awards, and in relation to the total numbers of employees aged 15, 16, 17, 18, 19, and 20 in the workforce in Australia. [309] The Ai Group called evidence from two expert witnesses: Professor Philip Lewis, Emeritus Professor of Economics at the University of Canberra and Director of the Centre for 155 Exhibit 13. 156 Exhibit 1. 157 Exhibit 1, [11]. 158 Exhibit 2. 159 Exhibit 6. [2026] FWCFB 75 89 Labour Market Research, and Dean Hyslop, PhD, Senior Fellow, Motu Economic and Public Policy Research (formerly Professor of Econometrics at Victoria University of Wellington).160 [310] Prof Lewis gave a report of 25 June 2025,161 in which he provided a detailed response to Prof Borland’s reports, indicating areas of agreement and disagreement. Prof Lewis also raised additional matters that he considered should be taken into account in respect of this application. He provided his expert opinion on likely regional impacts. As to changes to youth wages he considered international cases including New Zealand, Belgium, Portugal, Canada and Netherlands. His report also went to the evidence on youth wages and employment in general, and to the importance of employment for youth. [311] Dr Hyslop provided a principal report of 2 October 2024162 (“the Hyslop principal report”) in relation to New Zealand’s reforms to minimum wages for workers aged 16 to 19 in 2001 and 2008, and the consequences of the reforms for employment. Dr Hyslop’s principal report also went to the relationship between minimum wages and labour market outcomes, and the potential effects of the variations sought in these proceedings. Dr Hyslop provided a supplementary report of 27 June 2025163 (“the Hyslop supplementary report”) in response to a request from Ai Group for revised estimates based on different assumptions, and for a response to a passage from Prof Borland’s principal report which related to the New Zealand reforms (and which had drawn on literature from, inter alia, Dr Hyslop). [312] The ARA called expert evidence from Professor Richard Holden, Scientia Professor of Economics, School of Economics, UNSW Business School. Prof Holden gave a report of 3 July 2025.164 His report considered the anticipated impact of the proposed variation of each of the three modern awards on the labour market (including any substitution effects), on young people, including on employment opportunities and other pathways as well as the long-term impact of these changes, on employment costs and any further costs to business, and on the national economy, including any impact on inflation. He also considered differences by reference to location, business size, and socio-economic status of different cohorts of young people. He responded to Prof Borland’s opinion and gave his own as to the international literature in respect of changes to minimum wages for young people, including in relation to effects on employment. The SDA objected to parts of Prof Holden’s report being admitted. We have discussed those objections below. In addition to his report Prof Holden provided a volume of sources he had cited.165 We also received an excerpt from an AIHW report166 that Prof Holden had referred to during cross-examination.167 160 We have referred to Dr Dean Hyslop as “Dr Hyslop” on advice from Ai Group, the party that called him as an expert witness in these proceedings, notwithstanding he has previously held a position as a Professor. 161 Exhibit 77. 162 Exhibit 84. 163 Exhibit 85. 164 Exhibit 80. 165 Exhibit 81. 166 Exhibit 107, Australian Institute of Health and Welfare (2023) Australia's welfare 2023 data insights, catalogue number AUS 246, AIHW, Australian Government., Chapter 7. 167 PN2095. [2026] FWCFB 75 90 [313] Prof Borland provided a report in reply, of 1 August 2025 (“the Borland reply report”).168 In that report Prof Borland considered and responded to the reports from Dr Hyslop, Prof Lewis, and Prof Holden, providing areas of agreement and disagreement. Prof O’Brien provided a report in reply of 11 August 2025,169 (“the O’Brien reply report”) also in response to the reports from Dr Hyslop, Prof Lewis, and Prof Holden. We received substantial amounts of expert evidence from the SDA, Ai Group, and ARA in these proceedings, and a substantial part of the hearing was devoted to the examination of the experts. Despite this, the Ai Group, in closing, submitted that the expert evidence had told us “a whole lot of not much.”170 In relation to the potential employment effects of the proposed variations, the expert evidence went to economic theory, empirical research, and modelling. We acknowledge the limitations of economic expert evidence, which can tell us only what the experts consider likely, informed by their expertise. Despite the limitations of such expert evidence, it has assisted us in our consideration of, particularly, the modern awards and minimum wages objectives. Submissions [314] We will now seek to summarise the submissions made in these proceedings. The nature of the statutory scheme, the number of parties making submissions, and the wide range of issues canvassed makes it impractical to be comprehensive in doing so. We have carefully considered all of the submissions made and we have referred to them further as necessary in our consideration, below. SDA’s submissions [315] The SDA provided an outline of submissions dated 6 November 2024171 and outline of reply submissions dated 13 August 2025.172 They filed written closing submissions on 25 November 2025,173 and supplemented those with oral closing submissions. The SDA also tendered a bundle of research reports.174 [316] The SDA submitted that junior rates have applied across the system of regulation of wages in Australia since its inception. It submitted that while various rationales have been expressed over the years for their existence, no consistent justification or basis for junior rates had been maintained over the whole period. It submitted many of the rationales used to justify junior rates were the same as those used to justify differential rates of pay for women, and submitted that these rationales have since been acknowledged by the Commission as containing 168 Exhibit 3. 169 Exhibit 7. 170 PN4852. 171 Outline of Submissions of the Shop, Distributive and Allied Employees’ Association, 6 November 2024 (“the SDA’s outline of submissions”). 172 Outline of Reply Submissions of the Shop, Distributive and Allied Employees’ Association, 13 August 2025 (“the SDA’s outline of reply submissions”). 173 Closing Submissions of the Shop, Distributive and Allied Employees’ Association, 25 November 2025 (“the SDA’s closing submissions”). Both redacted and unredacted versions were provided. 174 Exhibit 76. [2026] FWCFB 75 91 embedded prejudices and assumptions that were not appropriate in a rational wage-setting exercise. [317] It submitted that 21 was the age of majority at common law as a matter of historical accident but was altered by all states in the 1970s. It submitted that setting 21 as the exit age for junior rates was also a matter of historical accident, and that its acceptance and justification had never been thoroughly reviewed in Australian industrial jurisprudence, unlike “female rates.” It submitted there is “no magic to the age of 21 years.” It submitted that a study of the history of junior rates reveals that the rationales for junior rates over the years are not evidence- based but have been based on a combination of prejudicial assumptions and industrial convenience. The SDA’s written submissions set out a history of junior rates drawing on the general history of wage-fixing commencing with the pre-Harvester era, the period post- Harvester to 1937, the Second World War and the post-War era, the equal pay era from 1969 to 1974, the period from 1975 until the Fair Work Act, and then the present period commencing with the making of modern awards. [318] The SDA submitted that the Commission is empowered by s 157 of the Fair Work Act to make a determination varying a modern award, subject to its satisfaction of a number of statutory criteria. It submitted that, first, the Commission must be satisfied that making the determination is necessary to achieve the modern awards objective found in s 134(1), referring to s 157(1). Second, where, as here, the determination would vary modern award minimum wages, the minimum wages objective in s 284(1) also applies. Third, the Commission must be satisfied that the variation is justified by work value reasons as defined by s 257(2A); and that making the determination outside of the system of annual wage reviews is necessary to achieve the modern awards objective: s 157(2). Finally, in performing its functions and exercising its powers, s 578(a) states that the Commission must take into account the object in s 3 of the Fair Work Act to provide a balanced framework for cooperative and productive workplace relations that promotes national economic prosperity and social inclusion for all Australians, including by the matters set out in subparagraphs (a)–(g), including most critically here, it submitted, ss 3(a) and 3(b). [319] The SDA submitted that the variations it sought are justified by work value reasons, and are necessary to meet the modern awards objective and the minimum wages objective. It submitted the modern awards objective requires the Commission to ensure that modern awards, together with the National Employment Standards, provide “a fair and relevant minimum safety net of terms and conditions”, taking into account the factors in s 134(1)(a) to (h). It referred us to the principles applicable to the Commission’s consideration of the modern awards objective.175 As to work value reasons the SDA referred to the definition in subsection 157(2A). It submitted the expression ‘related to’ in that subsection is one of “broad import”, requiring a sufficient connection or association of the relevant work value reasons with the matters set out in (a)–(c).176 It submitted that as with the assessment of the modern awards and minimum wages objective, assessing work value reasons is a broad evaluative judgment, because the language of s 157(2A) (‘satisfaction’ that a variation is ‘justified’ by the prescribed reasons) involves “an 175 Citing Application to vary the Real Estate Industry Award 2020 [2020] FWCFB 3946 (“the Real Estate decision”), [54]- [56]. 176 Relying on Aged Care Award 2010; Nurses Award 2020; Social, Community, Home Care and Disability Services Industry Award 2010 [2022] FWCFB 200, 319 IR 127 (“Aged Care Stage 1 decision”). [2026] FWCFB 75 92 element of subjectivity … about which reasonable minds may differ”.177 It submitted that section 157(2A) does not require identification of changes in work value measured from a fixed datum point.178 In this case, it submitted, referring to the lay evidence, work value reasons justify an increase because: (a) employees aged between 18 and 21 perform the same duties, use the same skills and have the same responsibilities (including in relation to supervision), and work under the same conditions (including as to any training) as employees doing the same job who are over 21 years of age; (b) employees who are 17 years of age perform largely the same duties, use the same skills and have the same responsibilities (including in relation to supervision), and work under the same conditions (including as to any training), as employees doing the same job who are 18 years of age; (c) employees who are under 16 years of age perform largely the same duties, use the same skills and have the same responsibilities (including in relation to supervision), and work under the same conditions (including as to any training) as employees doing the same job who are 16 years of age. [320] Referring to the expert evidence the SDA submitted that: (a) the impact of the proposed variations on employment costs will be marginal; (b) the impact of the proposed variations on employment growth will be neutral within the labour market, and marginal within the retail sector; and (c) the proposed variations will have no appreciable impact on employment. [321] As to the modern awards and minimum wages objectives, the SDA referred to the above matters, and also submitted that: (a) there is substantive unfairness where junior employees are paid significantly less than other employees doing the same job under the same conditions; (b) it is uncontroversial that employees covered by the three Awards are low paid; (c) the proposed variations will make the modern awards system simpler and easier to understand and use by reducing the applicable junior rates from six to three. [322] In its reply and closing submissions the SDA addressed submissions from some parties as to the scope of the power to vary award minimum wages outside the Annual Wage Review, and whether variation was a necessity. [323] The SDA characterised the submission from the Ai Group as being that because there is an Annual Wage Review which encompasses junior rates, there can be no proper exercise of power to vary under the more general powers contained in s 157(2). The SDA submitted this was an overly mechanistic view of the legislation. It submitted section 157(2) expressly 177 Relying on Aged Care Stage 1 decision, [156], and citing 4 yearly review of modern awards – Pharmacy Industry Award 2010 [2018] FWCFB 7621, 284 IR 121 (“the Pharmacy (APESMA Work Value Claim) decision”), [164]. 178 Relying on 4 yearly review of modern awards – Pharmacy Industry Award 2010 [2018] FWCFB 7621, 284 IR 121 (“the Pharmacy (APESMA Work Value Claim) decision”), [168], quoted with approval in Aged Care Stage 1 decision, [171]. [2026] FWCFB 75 93 provides a route by which minimum wages can be increased outside of the annual wage review. The provision does not restrict the availability of the Commission’s power to increase minimum wages in any way, other than by the requirement that the increases be justified by work value reasons179 and making the determination outside the annual wage review is necessary to meet the modern awards objective.180 The SDA submitted that Ai Group seemed to impliedly recognise that the somewhat simplistic approach it adopted needed to be reinforced by submitting that the recent annual wage review demonstrates that there can be no necessity to make any variation as required by s 157(2)(b) of the Fair Work Act. The SDA submitted that the Ai Group had cited no authority to support its contention that the annual wage review operates to limit the availability of s 157(2) in this way. [324] The SDA referred to Ai Group and ARA’s submissions dealing with the concept of ‘necessity.’ It submitted that in Shop Distributive and Allied Employees Association v National Retail Association and Anor (No 2),181 a judicial review judgement in respect of the General Retail Industry Award, Tracey J182 had accepted the distinction between what was necessary and what was desirable, and had gone on to state that while that distinction could be accepted it must also be acknowledged that reasonable minds may differ as to whether a particular action is necessary or merely desirable. It submitted that the Commission had, on numerous occasions, referred to this passage when dealing with this question of necessity. They drew our attention to the consideration of ‘necessity’ in Re Four Yearly Review of Modern Awards - Penalty Rates.183 The SDA also referred us to the Aged Care Stage 1 decision,184 in relation to necessity in a work value context. The SDA submitted that it can thus be seen that the question of necessity is not one which can be determined simply by asking whether or not the application comes on within a few months of the Annual Wage Review. Nor can it seriously be contended that the Annual Wage Review operates as some sort of bar to the Commission considering the present application, either by virtue of its recency or because it somehow establishes that there cannot be “necessity” as required by the statute. The SDA submitted an examination of the reasons for the Annual Wage Review 2025 Decision discloses that the review consists of five paragraphs dealing with fair minimum wages for junior employees, trainees and employees with a disability. As far as junior rates are concerned the Expert Panel said this:185 “In respect of junior rates of pay, the ACTU made reference to the SDA’s application to abolish junior rates of pay for employees aged 18 and over covered by the Retail Award, the Fast Food Award and the Pharmacy Award. This application is listed for hearing before a Full Bench later this year. The ACTU otherwise called for the continuation of the established approach by which the Review outcome is applied to rates of employees for juniors, trainees and employees with a disability. No other party made any submission other than that the established approach should apply.” 179 Fair Work Act s 157(2)(a). 180 Fair Work Act s 157(2)(b). 181 [2012] FCA 480; (2012) 205 FCR 227. 182 Ibid, [46]. 183 [2017] FWCFB 1001; (2017) 265 IR 1 (“the Penalty Rates decision”), [136]. 184 Aged Care Stage 1 decision, [278]. 185 Annual Wage Review 2025 Decision, [120]. [2026] FWCFB 75 94 [325] The SDA submitted it could readily be seen that the Expert Panel in that Annual Wage Review was not invited to approach the question of junior rates in the Awards; rather it simply noted that this application was before the Commission. The Expert Panel did not make any observation that would support a submission that this application asks the Commission to “second-guess” the conclusions of the Expert Panel. [326] The SDA submitted that the Expert Panel’s observations in the Annual Wage Review 2025 Decision were unexceptional and did not have any bearing on the Commission’s task in the current application. It noted the lengthy hearing listed for this matter and said the matter was an obvious example of why the Commission is empowered to vary minimum rates outside the Annual Wage Review. It submitted the broad nature of proceedings such as these renders the Annual Wage Review an inapt vehicle for claims such as the present one.186 It submitted this application involves wide ranging and voluminous evidence directed at the three awards in question. It is appropriate to engage in such a broad inquiry on an award-specific basis. [327] The SDA also replied to submissions about the provisions in the Fair Work Act referring specifically to junior rates. It submitted the object of the Fair Work Act in section 3 does not specifically require that junior rates be fixed, and nor does the modern award objective in section 134. (As we have noted above, section 139(1) permits but does not require that junior minimum wages be included in a modern award. Section 153(3) likewise provides that junior rates are not to be regarded as discriminatory.) [328] As to section 284, the SDA acknowledged that the minimum wages objective does include an objective of providing a comprehensive range of fair minimum wages to junior employees. It submitted this of itself does not require the setting of those wages for all junior employees, and also submitted that this objective says nothing about the fairness of such wages in any given industry or occupation. As to the latter point, the SDA submitted that many modern awards contain no provision for junior rates (e.g. Air Pilots Award 2020, Ambulance and Patient Transport Award 2020, Car Parking Award 2020, Building and Construction Award 2020).187 It submitted that other awards only have junior rates for some employees under 21 (for example the Alpine Resorts Award 2020 or the General Retail Industry Award). It submitted the present application does not call for the abolition of junior rates in the three Awards under consideration. The principal task before the Commission is to consider whether those three awards meet the modern awards objective. They contended that, in respect of junior rates, those three awards do not meet the modern awards objective. [329] At closing, the SDA provided a consolidated set of written submissions comprising its primary and reply submissions, supplemented with closing submissions including conclusions it said ought to be drawn from the evidence. As indicated above they also made oral submissions at the hearing. We have had the benefit of considering the SDA’s written and oral submissions in full. 186 SDA’s closing submissions, [32]. 187 Noting that there are apprentice rates in the Building and Construction Award, but these are competency-related, not age related. [2026] FWCFB 75 95 RAFFWU’s submissions [330] RAFFWU filed an outline of submissions on 6 November 2024188 and made oral closing submissions at the hearing. They supported the application to the extent it sought to remove age-based rates for people aged eighteen years and over. For people aged under eighteen they opposed the application and instead submitted that discriminatory wages based on age ought to be abolished. [331] It submitted the Commission is required to eliminate wage discrimination, relying on three bases: • international obligations; • the irrelevance of the definition in section 153; and • the modern awards objective. [332] As to international obligations, it referred the Commission to Article 23 of the Universal Declaration of Human Rights, as well as to the ratification of ILO Convention (No. 111) on Discrimination (Employment and Occupation) (1958; 362 UNTS 31), ratified by Australia in 1973, and the later “expansion of the ambit of discrimination by the Australian Government to include age.” It set out two bases for us to consider these instruments: the Acts Interpretation Act 1901 (Cth), s 15AB(2)(d), and the text of the Fair Work Act itself. [333] As to section 153, it described subsection 153(3)(a) as creating a ‘legal fiction’ to overcome the prohibition at s 153(1) on discriminatory terms of modern awards. It submitted that, however, section 153 does not override the modern awards objective, nor the international obligations imposed on Australia. The section merely provided that the prohibition at s 153(1) does not apply to (discriminatory) junior rates. RAFFWU did not argue that section 153 prevents the inclusion of junior rates but argued that the inclusion of junior rates at all is inconsistent with the UDHR and the Employment Discrimination Convention, offends the objects of the Fair Work Act, and undermines the modern awards objective. [334] As to the modern awards objective, RAFFWU referred us particularly to paragraphs (a) and (aa) of section 134(1). It submitted the living standards and needs of the low paid are demonstrably undermined by discriminatory junior rates. It submitted it is notorious that young workers, including those below 18 years of age, must support themselves in many circumstances. This includes in providing the necessities of life as well as contributing to households living in poverty. RAFFWU submitted the very existence of discriminatory wage rates not only offends foundational human rights, it also causes the living standards and needs of low paid workers to be suppressed, subverted, undermined and attacked. [335] It submitted junior rates meant young workers, often secondary school students, were exploited more often, and had to work more hours. It submitted the existence of junior rates forces more children who live in poverty to work more hours to be able to survive. It submitted children living in poverty are more likely to be put to work and for more hours. It submitted such children are more likely to abandon education to feed themselves and their families. They are more likely to be forced to abandon their education because of junior rates. It submitted these facts are notorious. 188 RAFFWU’s Outline of Submissions, 6 November 2024 (“RAFFWU’s outline of submissions”). [2026] FWCFB 75 96 [336] RAFFWU submitted that higher rates would allow children to work fewer hours allowing more time for education, family, and community. It argued the proposition that junior rates could provide work opportunities not otherwise afforded to children should be rejected. It submitted this view had been “espoused by the profiteers of child labour exploitation for centuries.” To the extent that children are provided an opportunity to learn work skills and share in the community of the workplace, they ought to be fairly rewarded by equal pay for equal work, to meet a fair living standard and to meet their needs. In the alternative and without conceding its primary position, or conceding that any incentive was needed for employers to hire children or young people, it submitted that children working 30 hours per week were not entitled to superannuation, and that that would not be affected by this application. The implicit submission was that even if junior rates were abolished it would still be materially less expensive to hire younger workers. [337] As to secure work, RAFFWU submitted that the modern award objective has changed to place secure work “front and centre.” It submitted that junior rates negatively distort job security and that hours were cut as workers aged. It submitted employers that pay junior rates are not equal opportunity employers. It submitted that some employers kept workers in casual employment and deployed rostering systems that allowed them to reduce workers’ hours as they aged, by de-rostering them. [338] It submitted that junior rates could have an adverse effect on workers’ safety because employers that employed children on junior rates were likely to view the child worker as an expendable commodity because they would not be employing them in the near future. Youth Law Australia’s submissions [339] Youth Law Australia supports the application. Youth Law Australia filed written submissions in support in February 2025,189 and provided closing submissions in writing on 24 November 2025.190 [340] In its written submissions of February 2025, Youth Law Australia made submissions as to the need for a determination having regard to the modern awards objective, the minimum wages objective, and the principal object of the Fair Work Act (specifically, section 3(b)). In doing so it focused on those factors that it considered most relevant to the Application from the perspective of the lived experience of young workers, being: a. the Commission’s duty to ensure a fair and relevant minimum safety net for young workers, and to consider the relative living standards of young people; b. the need to provide additional remuneration for employees working unsocial, irregular or unpredictable hours; c. access to secure work across the economy; d. the impact of junior wages on business, including regulatory burden. 189 Youth Law Australia – Submissions dated 11 February 2025 (“Youth Law Australia’s written submissions”). Youth Law Australia had leave to file their submissions after the date that had previously been ordered for materials to be filed in support of the application. 190 Final Submissions of Youth Law Australia dated 24 November 2025 (“Youth Law Australia’s closing submissions”). [2026] FWCFB 75 97 [341] Youth Law Australia submitted the three modern Awards under consideration in the present case do not currently act as a fair safety net for young workers covered by them. It referred us to Productivity Commission research that found youth incomes declined over a decade from 2008, and that the decline was partly attributable to decreased wages,191 and also to the SDA’s evidence regarding affordability difficulties said to be facing young workers earning junior wages. Youth Law Australia also referred us to what they described as “the well- documented mental health crisis” currently experienced by young Australians aged 15 to 20, and the particular vulnerabilities and disadvantages of young Australians. It referred to a poll by Black Dog Institute regarding cost being an impediment to obtaining mental health services, with young adults most affected by the cost impediment.192 [342] As to unsociable hours and section 134(1)(da) of the Fair Work Act, Youth Law Australia submitted that the penalty rates payable to a junior employee for working unsociable hours (such as evenings and weekends), and the casual loading applied for working irregular or unpredictable hours, are in most cases less than the junior wage percentage discount applied to their hourly rate. [343] As to secure work, Youth Law Australia submitted that it is common for young workers to be asked to work hours that interfere with their ability to engage with their schooling and tertiary education commitments, affecting their career potential and future security. [344] Youth Law Australia also submitted that junior rates represented a regulatory burden on businesses and contributed to errors and underpayments. [345] Youth Law Australia also made extensive submissions, both initially and in its closing submissions, as to Australia’s international labour obligations and the consideration of the instruments giving rise to those obligations by relevant international organisations and committees. In summary, it submitted that: • the provisions providing for lower wages for workers aged 18-20 (inclusive) in the Awards do not conform with Australia’s international labour obligations, and in particular, they violate Australia’s obligations to ensure: o equal pay for work of equal value; o equality of treatment and non-discrimination (and they cannot be considered a special measure of protection or assistance); o fair wages that provide an adequate standard of living. • making the orders sought by the SDA would bring the Awards into closer conformity with Australia’s international labour obligations. [346] In its closing submissions Youth Law Australia canvassed the evidence that had been heard in these proceedings as relevant to the international obligations they had referred us to. As to the nature of the work the subject of junior rates in the three modern Awards the subject of these proceedings, Youth Law Australia submitted that the evidence demonstrates that the 191 Youth Law Australia’s written submissions, [13], referring to Productivity Commission, 2020, Why did young people’s incomes decline?, Commission Research Paper, Canberra. 192 Youth Law Australia’s written submissions, [19] referring to Sam Harvey, ’Addressing Australia’s Mental Health Crisis: Time for Bold Reform’, Black Dog Institute (Web Page, 2024) https://www.blackdoginstitute.org.au/news/addressing- australias-mental-health-crisis-time-for-bold- reform/. [2026] FWCFB 75 98 nature of the work performed by junior employees under these Awards requires minimal skill, experience or supervision, and can be done by a person of any age. Ai Group’s submissions [347] Ai Group, a registered organisation, opposed the application. It filed an outline of submissions on 11 July 2025.193 It made oral closing submissions. Ai Group provided a bundle of research reports with its submissions. An amended version of the bundle was subsequently tendered.194 [348] Ai Group submitted the SDA’s proposed variations are not necessary to meet the modern awards objective and do not give effect to the minimum wages objective. Ai Group submitted it is plainly not necessary to consider the proposed variations outside the system of annual wage reviews. Ai Group made submissions on its own behalf and also supported the ARA’s submissions in relation to the General Retail Industry Award. [349] Ai Group submitted that subsection 157(2) of the Fair Work Act confers a limited discretionary power on the Commission to make a determination varying modern award minimum wages if it is satisfied that the variation is justified by work value reasons and making the determination outside of the system of annual wage reviews is necessary to achieve the modern awards objective. It also referred to the legislative note to the subsection and the application of the minimum wages objective. [350] It submitted that the requirement of necessity was fatal to the application. It did so on the basis of the structure of the Fair Work Act with respect to adjustments to modern award minimum wages. The Ai Group submitted that the statutory scheme seeks to reserve important and significant minimum wage reviews, including reviews of junior rates, to an Expert Panel. It submitted the SDA must satisfy the Commission that, in light of the statutory scheme, the nature of the Annual Wage Review, the procedural requirements in relation to it, and the nature of the Expert Panel, it is necessary to vary the junior rates “outside the system of annual wage reviews” to achieve the modern award objective. That is, not only must the variations be necessary to meet the modern awards objective, it must also be necessary to vary junior rates now, outside of the annual wage review, in order to achieve the first necessity. [351] Ai Group submitted that necessary is a strong word195 and involves a very heavy onus.196 Something is not necessary, merely because it is “convenient, reasonable or sensible”.197 It submitted there must be some material before the Commission demonstrating 193 Outline of Submissions of the Australian Industry Group, dated 11 July 2025 (“Ai Group’s outline of submissions”). 194 Exhibit 105. 195 Relying on Hogan v Australian Crime Commission [2010] HCA 21; (2010) 240 CLR 651 (“Hogan”), [30], which related to the use of the word necessary as it appeared in Federal Court of Australia Act 1976 (Cth) (“the Federal Court Act”) s 50, relating to non-publication orders. 196 Relying on Giddings v Australian Information Commissioner [2017] FCAFC 225, [25], which related to the Federal Court Act ss 37AF and 37AG, regarding making suppression or non-publication orders. 197 Relying on Hogan at [31]; and DPP (Cth) v Christian [2019] FCAFC 5; (2019) 268 FCR 84, [121] which related to the same provision of the Federal Court Act. They also referred us to Aged Care Stage 1 decision, [277], in which the Full Bench had cited Shop, Distributive and Allied Employees Association v National Retail Association (No 2) [2012] FCA [2026] FWCFB 75 99 that necessity, and a mere belief that it is necessary is insufficient.198 It submitted there is no such material, nor any such necessity, and the application fails at the outset. [352] As to work value, the Ai Group responded to the SDA’s submissions, commencing with its submission that junior rates lacked a proper, evidence-based rationale. Ai Group submitted that there have always been, and continue to be, sound rational bases to justify lower rates of pay for junior employees, based on research and evidence: (a) principally, discounted rates of pay promote access to employment for youths and young people by incentivising employers to offer employment to younger, inexperienced individuals instead of adults; (b) increased youth participation in the workforce is beneficial for individuals and society; (c) junior employees share characteristics that discourage employers from employing (and rostering) them over older, experienced workers; (d) people aged 21 years and under are, generally speaking, less mature than people aged over 21; (e) the removal or reduction of the discounted price of labour for junior employees means that they are less likely to be employed (or rostered once employed) over experienced adults; (f) the absence of junior rates is a feature of industries where individuals have sought to protect the jobs of adults from cheaper labour, though this has come at the expense of increased barriers to entry into those industries.199 This has, in turn, led to the concentration of junior employees in certain industries (including, proportionally, retail and fast food). Greater access to junior rates should be encouraged, rather than the removal and reduction of junior rates within those industries that contain them. [353] Further, it submitted that notwithstanding that the application of different rates of pay based on age is discriminatory, the Fair Work Act specifically deems junior rates terms in modern awards not to be discriminatory, and differential treatment for people doing the same job and/or work is expressly recognised and countenanced by the Fair Work Act. [354] Ai Group submitted the Commission should not lightly assume that the Commission and its predecessors have failed to comply with wage-fixing obligations when making awards and setting junior rates. It submitted this was especially so in relation to the General Retail 480; (2012) 205 FCR 227, [46]. They referred also, in this context, to the SDA’s submissions as to s 157 (accepted by Watson VP with no error found), at first instance in that matter: see National Retail Association Ltd [2010] FWA 5068, [16]. 198 HGMZ v Secretary, Department of Social Services [2021] FCA 280, [13], which also related to non-publication orders under the Federal Court Act, undisturbed on appeal, [2022] FCAFC 186. 199 Citing Fair Work Australia, 2011, ‘Waltzing Matilda and the Sunshine Harvester Factory’, Chapter 3.3 Minimum Wages for Adolescents, 132. [2026] FWCFB 75 100 Industry Award given that at the time it was made in 2010, and on two subsequent occasions, the Commission had specifically considered junior rates. [355] As to the SDA’s submissions regarding differential pay rates for the same work under the same conditions, the Ai Group submitted this was a distinct and accepted feature of the legislative scheme. It submitted that even if the Commission were to accept, at the very broad level, that insofar as employees of different ages are performing the same job, there may be little difference in the work that is performed and the conditions under which it is performed for some employees, that is no basis to grant the application. It submitted the entire premise of junior rates, and the Fair Work Act’s support for their continued existence, is that two individuals in the same classification, doing the same job, can appropriately be paid differently based upon their age. It also submitted: (a) it is likely the jobs in question have been designed based on an assumption that they will be performed by young people with little or no experience; (b) even if the work performed were found to be similar regardless of an individual’s age, systems have been arranged to account for the high rates of young employees, including in relation to levels of supervision and simplification of tasks (as opposed to multi-tasking), that would likely not be the case were it not for the high rates of juniors; (c) the fact that the work is performed by young people means that there is an acceptance (and tolerance for) higher rates of mistakes, and higher rates of supervision to identify and address those mistakes; (d) the business models of fast food restaurants have been developed on the assumed existence of junior rates of pay, and therefore rely heavily on relatively low-cost labour, which is built around low prices, high volume and quick service; and (e) there are also differences in relation to the quality of the work performed by junior employees compared to older employees. [356] Ai Group submitted that from the employer’s perspective the job and work performed between junior employees and adult employees is quite different, requiring different work and rostering arrangements, and which delivers different outcomes to the employer’s overall enterprise. [357] As to economic impacts, the Ai Group submitted that the impact of the proposed variations on employment costs would be significant. While Ai Group did not concede that it is unlikely there will be a significant net effect on employment overall nationally, it is, in the Ai Group’s submission, more relevant that the proposed variations to junior rates would have a significant negative effect on and a net decline in youth employment in the fast food and retail industries. The Ai Group submitted that the impacts on employment would be affected by the threats to viability to some businesses, for whom the increased employment cost would mean some may need to close. Fast food is an important employer of young people, particularly in regional and remote areas. Restaurant closures, resulting in reduced employment opportunities for young people in regional and remote areas, is one likely impact of the SDA’s proposed variations. The Ai Group also submitted that the SDA’s expert witness Professor Borland, in [2026] FWCFB 75 101 his report, had taken no account of the increased risk of automation, which could negatively affect employment. It submitted the lay witness evidence by Ai Group shows that there has been increasing levels of automation in fast food restaurants, and it is likely to continue (especially in the face of escalating labour costs). [358] In respect of the modern awards objective Ai Group responded to the SDA’s submissions about equal pay for work of equal value, which the Ai Group described as a “same job, same pay” argument, by relying on its submissions that the Fair Work Act contemplated different pay for juniors, including explicitly in the minimum wages objective (at subs 284(1)(e)). They argued that providing different rates for juniors could not be inconsistent with the modern awards objective or the minimum wages objective because if it were, junior rates could not be countenanced in any award. [359] Ai Group also submitted that junior rates are not unfair to junior employees who would not be employed but for the existence of such rates. It submitted that employment carries a host of benefits beyond the monetary reward,200 and gave examples that:201 (i) “provided they do not work beyond 15 hours per week, junior employees have better marks at school, higher rates of completion and enrolment in tertiary studies, and higher rates of employment in full time work; (ii) conversely, where an individual has not worked by the age of 25, the risk of long-term unemployment is higher. In other words, young people who have been unemployed through school, find it harder to obtain steady work compared to those who have been working; (iii) lack of experience is the most common reason why youth (aged 15 to 24) are unsuccessful in obtaining work. Junior employment helps to overcome this problem for youth; and (iv) holding down a job early is a “bridge” to employment in adulthood. Working develops a teenager’s work-related knowledge, skills and habits and signals general work aptitude to prospective employers.” (citations omitted) [360] Ai Group submitted that though it was accepted that junior employees are “low paid,” the needs of this cohort of the low paid differed from better paid employees. It also submitted, in relation to relative living standards, that the research shows most young people who are employed live at home with their parents and are in relatively high-income families. Those who do not live at home can receive income support payments from the government — such as Youth Allowance and JobSeeker Payment, to help when they are studying or living independently. In any event, It submitted that the “safety net of fair and relevant minimum wages” is not designed to, and is not intended to, represent a “living wage,”202 and it was not for the Commission to identify appropriate benchmarks of the cost of living as such an approach 200 Relying on Quinn v Overland [2010] FCA 799; (2010) 199 IR 40, [101]-[103]; and Trego v Wesbeam Pty Ltd [2019] FCA 1030, [78]. 201 Ai Group’s outline of submissions, [37](b), and the sources there cited. 202 Citing Safety Net Review – Wages April 1997 (AIRC, P1997, 22 April 1997), section 7.6. [2026] FWCFB 75 102 would blur the lines between the roles of the Commission in setting award wages, and social welfare. It submitted that the Commission is not a social welfare agency. 203 [361] The Ai Group submitted that there would be no material effect on simplicity of administration, or ease of understanding, of the modern awards if the variations were made. [362] Relying on international examples Ai Group submitted reducing the discount for junior employees would reduce access to secure work. [363] It submitted that the evidence indicates that employees paid junior rates are disproportionately female. It submitted that placing barriers to employment would therefore not facilitate women’s full economic participation. [364] It also submitted the variations if made would suppress social inclusion by decreasing workforce participation by juniors. It referred us to the 1999 AIRC Junior Rates Inquiry report, submitting that the Full Bench had concluded that well-designed junior rate classifications, framed to reduce the capacity for exploitation, could justifiably be used to create or protect employment opportunity for young people.204 The Ai Group also submitted there were hidden costs to employing young people. [365] It submitted that if granted the variations would likely have significant adverse impacts on businesses within the fast food industry and retail, including affecting profitability and making many unviable. This would affect small businesses, many of which were in regional and remote parts of Australia. [366] Ai Group submitted the decreased participation of young people in the workforce would have negative impacts on the national economy. It submitted the industries that are the subject of this application are the major employers of young people in Australia. Particularly over time, the reduced participation of young people in these industries would lead to an increase in unemployment rates, decrease in participation in tertiary studies and worse outcomes at school. It submitted it stands to reason that this would impact the national economy. [367] The Ai Group submitted that reducing the discount on junior rates of pay is contrary to the minimum wages objective. It referred us to the mandatory considerations under that objective and made submissions to the same effect as those made in respect of the overlapping considerations under the modern awards objective. It also submitted that if the variations were granted, approximately half of all junior rates in the Fast Food Industry Award and the General Retail Industry Award would be removed, which would result in a diminished range of fair minimum wages for junior employees. [368] In addition to its written outline, and submissions made orally at hearing, the Ai Group also supplied us with aides memoire regarding the evidence and research.205 The aide memoire as to the SDA’s lay evidence in reply essentially went to why we should prefer the Ai Group’s 203 National Wage Case 1974 (1974) 157 CAR 293 (“1974 National Wage Case decision”), 299. 204 Junior Rates Inquiry – Report of the Full Bench Inquiring under Section 120B of the Workplace Relations Act 1996 (AIRC, R5300, 4 June 1999) (“the 1999 AIRC Junior Rates Inquiry report”), at Summary, [1] and [9(v)]. 205 Ai Group’s Aide Memoire on research evidence propositions of fact and Al Group’s Aide Memoire on SDA lay evidence in reply, each provided on 25 November 2025. [2026] FWCFB 75 103 witnesses’ evidence to that of the SDA witnesses’. The aide memoire as to research sought to draw out findings that could be made, based on the research that had been put before us. We have considered these aides. The Ai Group also provided a statement of agreed facts, as between (at least), the principal parties and RAFFWU, going to a small number of uncontroversial matters.206 The ARA’s submissions [369] The ARA, a registered organisation, filed an outline on 11 July 2025207 which also included a list of government income support and concession measures of which it asked us to take notice. The ARA also filed written closing submissions on 26 November 2025,208 which followed the structure of, and elaborated upon, its earlier outline. The ARA also supplemented its closing written submissions with oral submissions at hearing on 26 November 2025. They also assisted us by providing a table showing the changes to (base) hourly rates for full-time and part-time employees under Levels 1 to 3 of the General Retail Industry Award, if the application were to be granted.209 [370] The ARA’s submissions were made in opposition to the application, directed particularly towards the application to vary the General Retail Industry Award. [371] The ARA submitted that the retail industry provides important and valuable entry-level employment for young people in Australia. It submitted the low-skilled and flexible nature of work in the retail sector offers meaningful opportunities for young Australians to enter the workforce and gain early work experience, which is connected with retention in schools and education, leading to greater long-term employment prospects. [372] It submitted the application threatens the viability of continued employment of junior employees in the retail sector, particularly in rural and regional areas, which would disproportionately impact young people from lower socio-economic backgrounds. It submitted that in these circumstances and having regard to persistent youth underemployment in Australia, the Commission must carefully weigh the perceived benefits of the SDA’s application with the real and significant risk of the reduction of youth employment, which would ultimately hinder and not promote the interests of junior employees or the broader community. [373] The ARA opposed the application on the basis that the Commission’s power to make a determination varying junior rates in the General Retail Industry Award, Fast Food Industry Award and the Pharmacy Industry Award is not enlivened because there is no necessity to make the proposed variation determinations “outside the system of annual wage reviews.” [374] The ARA also opposed the application on the ground that the Fair Work Act explicitly permits junior rates and there is no requirement to consider historical undervaluation (in 206 Exhibit 106; PN3597. 207 The Australian Retailers Association’s Outline of Submissions, dated 11 July 2025 (“the ARA’s outline of submissions”). 208 The Australian Retailers Association’s Closing Submissions, dated 26 November 2025 (“the ARA’s closing submissions”). 209 Marked for identification as R5. [2026] FWCFB 75 104 contrast to the provisions relating to gender), and in any event the rationale for junior rates recently articulated in respect of the rates for 20-year-olds under the General Retail Industry Award, remained current. Further, it submitted in respect of junior retail employees currently covered by the General Retail Industry Award there are key differences in the nature of the work, the level of skill and responsibility involved in doing the work and the conditions under which the work is done, such that the proposed increases to junior rates under the General Retail Industry Award are not justified. It also submitted that the proposed variations are not necessary to achieve the modern awards objective or the minimum wages objective, having regard to the needs of junior employees and the likely negative impacts on employment costs, job security, social inclusion and workforce participation, employment growth and the national economy. As to the latter considerations it submitted that: • having regard to the typically low profit margins amongst retail businesses, the increase in costs resulting from the proposed variations would likely lead to business closures, job losses and an increase in automation that would lead to further job losses, with a greater undesirable effect on rural and regional businesses than metropolitan businesses; • given the magnitude of the proposed increases, particularly in respect of 18-year-olds (42.86% percentage increase), the proposed variation is expected to result in a material increase in youth unemployment. In the context of persistently high youth unemployment rates, such an impact could have significant consequences given the importance of youth employment on educational participation and in reducing inequality for younger people from low socioeconomic backgrounds; • in respect of the national economy, there is likely to be significant spillover results, including the potential for significant increases in wage and price inflation. The increases could also result in substantially negative share-price effects for publicly listed companies, which could, in turn, impact the superannuation portfolios of many Australians. [375] We were assisted by the ARA’s submissions as to the conclusions to be drawn from the expert evidence about the likely impact of the variations, if granted, on matters such as costs for employers, and employment. We were also assisted by its summary of its lay witnesses’ evidence and what we should take from it. [376] The ARA made submissions as to the statutory framework and the jurisdiction, referring us to the obligation under section 578(a) of the Fair Work Act to take into account the objects of the Act, and to, particularly, the introductory words of section 3 and paragraphs (a) and (b) of that section. As to the reference to “job security” it referred us to paragraphs 330 and 334 of the Revised Explanatory Memorandum to the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Bill 2022 (Cth) and also observed that amendments were also made to include job security in the modern awards objective. [377] In support of its argument that the SDA’s proposed variations were not necessary outside the annual wage reviews, the ARA took us to provisions in Parts 2-3 and 2-6 of the Act including ss 157, 284, and 285. Having done so it submitted that, in light of the statutory mandate to consider junior rates as part of the annual wage review in each financial year, there [2026] FWCFB 75 105 is no apparent need for the Commission to consider junior rates outside of the usual system of annual wage reviews. It submitted that in the most recent annual wage review, the Annual Wage Review 2025 Decision, the ACTU had made reference to the SDA’s application, but no other party had made any submission other than that the established approach should apply. It submitted that given that the Commission in the Annual Wage Review 2025 Decision would have had regard to its statutory obligation under s 284(1)(e) to provide for “a comprehensive range of fair minimum wages to junior employees”, the position adopted in the Annual Wage Review 2025 Decision should be understood as reflecting the appropriate settings for wages for junior employees. [378] In respect of its argument as to work value, the ARA referred us to subsections 157(2), (2A), and (2B). Relying on the Aged Care Stage 1 Decision, it made the following submissions as to the construction of section 157: (a) subsection 157(2A) exhaustively defines “work value reasons”, although the objects of the Fair Work Act will inform the interpretation and application of the concepts within s 157(2A);210 (b) the expression “related to” is one of broad import that requires a relevant, not remote or accidental, connection or association between the two subject matters;211 (c) “justified” means that the “work value reasons” show the variation of modern award minimum wages to be just, right or warranted, or provide a satisfactory reason for the variation;212 (d) subsection 157(2A) of the Fair Work Act does not incorporate the test, which operated under wage fixing principles of the past, that the change in the nature of work should constitute “such significant net addition to work requirements as to warrant the creation of a new classification or upgrading to a higher classification”.213 [379] The ARA also assisted us with submissions about the operation of subsection 157(2B). It submitted that section 157(2B), added by the Secure Jobs, Better Pay Act, is clearly directed at eliminating gender-based assumptions in the Commission’s determination of work value reasons. It submitted no such equivalent provision exists in respect of assumptions based on age. By contrast, the Fair Work Act contains a number of provisions which expressly permit the inclusion of modern award minimum wages for all or a class of junior employees, which are defined by reference to their age (being under 21). Referring to the provisions of the Act explicitly providing for junior rates, the ARA submitted that those provisions stand in stark contrast to the requirements regarding assumptions based on gender under subs 157(2B). Rather than seeking to eliminate the determination of minimum wages by reference to age-based assumptions, the Fair Work Act expressly permits the inclusion of minimum wages for employees aged under 21 years, and expressly provides that the inclusion of such terms in modern awards is not discriminatory. Accordingly, findings in previous decisions determined 210 Citing Aged Care Stage 1 decision, [148], [293]. 211 Citing Aged Care Stage 1 decision, [155], [293]. 212 Citing Aged Care Stage 1 decision, [137], [293]. 213 Citing Aged Care Stage 1 decision, [293]. [2026] FWCFB 75 106 by reference to historical gender undervaluation are of no, or alternatively very limited, utility to proceedings relating to junior rates. [380] As to the modern awards objective the ARA referred us to the relevant provisions of the Fair Work Act and took us to Shop, Distributive and Allied Employees Association v National Retail Association (No 2),214 in which the court had elaborated on the proper construction of section 157(1).215 It referred us to the established principles applicable to the interpretation and application of section 134(1), and to the consideration of them by previous Full Benches.216 They took us also to the provisions regarding the minimum wages objective and submitted that the general approach to be taken to the interpretation and application of the minimum wages objective is broadly the same as for the modern awards objective.217 [381] The ARA’s written submissions responded to the SDA’s written submissions as to the history of junior rates, drawing our attention to consideration in the General Retail Junior Rates (20-year-olds) decision, including the Full Bench’s consideration of the 1999 AIRC Junior Rates Inquiry report. The ARA also drew our attention to the judgement of the Full Court of the Federal Court of Australia in the judicial review of the General Retail Junior Rates (20- year-olds) decision.218 The ARA submitted no additional evidence had been led to specifically warrant the departure from the Full Bench’s findings regarding 20-year-olds with six months or less experience, and so it was not clear how the removal of junior rates for that cohort is now justified. It further submitted that having regard to the history junior rates are a longstanding feature of the regulation of wages in Australia. It submitted that in considering whether the variation is “justified” by work value reasons or “necessary” to achieve the modern awards objective, the Commission should take into account that the proposed variations would significantly disrupt an industrial practice which has been accepted over the last century. [382] The ARA submitted there are no work value reasons justifying the SDA’s proposed variations, having regard to the size of each proposed increase. It submitted that because the SDA proposal did not abolish junior rates for persons under eighteen, the SDA had accepted, to a degree, that the age of an employee is a relevant consideration for determining work value. The ARA made submissions as to the evidence and the conclusions to be drawn in relation to work value, having regard to the nature of the work, the level of skill and responsibility, and conditions of work. [383] The ARA made submissions as to the modern awards objective and the minimum wages objective, including submissions as to the conclusions to be drawn from the expert evidence. In relation to employment costs and viability it drew our attention to the evidence regarding costs for business, including expert evidence that regional and rural retailers would be affected more 214 [2012] FCA 480; (2012) 205 FCR 227. 215 ARA’s closing submissions, [91] referring to Shop, Distributive and Allied Employees Association v National Retail Association (No 2) [2012] FCA 480; (2012) 205 FCR 227, [35]-[37] and [46]. 216 Including in the Real Estate decision, [54]-[56]; Re Horticulture Award 2020 [2021] FWCFB 5554; 311 IR 1 (“Re Horticulture Award”); Security Services Industry Award 2010 [2015] FWCFB 620 (“Re Security Services Industry Award”), [8]. 217 Citing Gender-based undervaluation—priority awards review [2025] FWCFB 74; 340 IR 1 (“Gender-based undervaluation decision”), [37]. 218 National Retail Association v Fair Work Commission [2014] FCAFC 118; (2014) 225 FCR 154, drawing our attention particularly to [79]. [2026] FWCFB 75 107 acutely. As to employment, access to secure work, social inclusion and workforce participation, the ARA referred to the expert evidence in relation to youth unemployment, as well as lay evidence from retailers. They made submissions as to effects on the national economy, including in respect of employment growth. In that context it referred us to flow-on effects of youth unemployment and the concept of labour market scarring, referring to long-term adverse employment outcomes following youth unemployment disproportionately affecting youths of lower socioeconomic status. They also made submissions regarding the expert evidence as to effects on the national economy more broadly. [384] As to the needs of the low paid, the ARA asked the Commission to take into account the high proportion of junior employees who live with parents or other carer, noting that in the 2021 Census, 72% of 19-year-olds recorded living with their parents. In this regard it referred us to an Australian Institute of Family Studies document, ‘Young people living with parents,’ of June 2023. They also asked us to take into account the availability of concessions, discounts, and government income support which significantly assist the financial needs of employees under 21 years of age. It also submitted we should consider the potential negative impacts on junior employees’ needs arising from a reduction in job opportunities and potential increases in inequality, the latter being a reference to the consequences of youth unemployment especially for young people from low socioeconomic backgrounds, especially in rural and regional areas.219 We have treated this submission as to inequality cautiously; there was little ventilation, in the expert evidence, as to the respective effects of lower or higher minimum wages on inequality.220 But we accept that young people facing disadvantage because of socioeconomic status and/or geographic location are likely to be at greater disadvantage in the labour market than other young people. However, Professor Borland’s evidence was that his analysis of Census data showed that the proportion of 15- to 19-year-olds in the affected retail sectors was similar in capital cities and regions (24.3 percent, compared to 24.1 percent), and the proportion in fast food was actually larger in the capital cities than the regions (24.3 percent compared to 18.4 percent).221 [385] The ARA also indicated that if any determination was to be made it would wish to be heard as to transitional arrangements. Pharmacy Guild’s submissions [386] The Pharmacy Guild opposed the application, submitting that the Pharmacy Industry Award includes fair and relevant rates for junior employees, and that the variations sought cannot be justified by work value reasons and are not necessary to meet the modern awards objective and minimum wages objective. [387] The Pharmacy Guild submitted that the existing limitations on the use of juniors under the Pharmacy Industry Award are appropriate and sufficient. It submitted the 2017 consent variation to remove junior rates for all classifications other than for pharmacy assistants working at classification levels 1 and 2 was appropriate. It submitted that at that time the SDA did not make any application to vary the relativity between the junior and adult rate, but it could 219 A matter dealt with by Prof Lewis at Exhibit 77, [30]. 220 A matter also dealt with by Prof Lewis at Exhibit 77, [30]. 221 Prof Borland’s reply report, Exhibit 3, [52]. [2026] FWCFB 75 108 have done so. It submitted that in making the consent variation the Commission was satisfied that the variation met the modern awards objective. [388] It submitted that junior employees, on the whole, do not perform the work of a level 1 or level 2 pharmacy assistant with the same level of accountability and responsibility, or under the same conditions or with the same level of skill as adult employees. They accepted that some junior employees, as is the case with adult employees, perform at a higher level than others. It submitted there is nothing preventing employers from recognising and rewarding those employees in ways additional to the minimum wages. [389] The Pharmacy Guild accepted that there is little to no difference in the basic training that an adult or junior level 1 or level 2 employee receives on commencement to perform the role (such as learning to operate the register). However, the Guild submitted that there is an increased level of on-the-job supervision, support and monitoring of junior employees to maintain productivity and ensure the safety and well-being of the junior and customers. It submitted that the observation and support of the junior by the employer, particularly in small businesses, is often not structured or formal and usually occurs without the junior employee being aware of it. It submitted that performance feedback, or direction and assistance provided on the job (listening in and jumping in to assist a customer), is frequently provided in such a way that the junior employee would not be aware that it was due to their own skill limitations. [390] The Pharmacy Guild submitted its evidence would show that as compared to adult pharmacy assistants, it was on the whole more likely that junior pharmacy assistants: • do not have the same level of emotional intelligence and empathy; • do not have the life experiences that assist in readily empathising with patients • do not have the same confidence to approach all types of patients in the pharmacy to offer assistance; • are less likely to be approached by customers for assistance; • require a higher level of supervision and monitoring and that the younger the worker the closer the supervision and monitoring.; • are not expected to perform to the same level, it may take them longer to perform tasks and employers have a higher level of tolerance for minor mistakes or missed customer service opportunities; • are less confident in dealing with general responsibilities that come with being an employee such as, reviewing rosters, calling in sick, personal presentation and approaching management; • require a higher level of support and encouragement from the pharmacy owner / management generally to maintain engagement and productivity; • are less likely to view working in the community pharmacy sector as a long-term career; • have limitations on the hours they can work due to school or university commitments and are engaged on a part-time or casual basis; • are hired as investment in / commitment to the local community to provide job experience for young people; • are rostered to work when the foot traffic in the store is less likely to be higher needs patients, such as in the evenings and weekends; and • are rostered to work together (i.e. more than one junior on a shift), particularly on weekends and evenings. [2026] FWCFB 75 109 [391] As to employment effects, the Pharmacy Guild submitted its evidence would show that if it becomes more costly to hire junior pharmacy assistants at level 1 and level 2 of the Pharmacy Industry Award, they would: • likely offer the work to adult employees with greater work / life experience or junior employees who have attained the Certificate III pharmacy assistant qualification (for whom the adult rate applies); • not offer, or significantly decrease, the hours offered to level 1 and level 2 pharmacy assistants aged 18,19 and 20, particularly those engaged on part-time or casual basis; and • consider reducing their opening hours, particularly at times when penalty rates apply. [392] It submitted the SDA’s evidence was not sufficiently probative to justify a variation to the Pharmacy Industry Award for work value reasons or at all. It submitted the SDA’s expert evidence largely dealt with juniors’ employment in general retail and the fast food sector. It submitted that the expert evidence, being that the impact on costs to pharmacy employers would be low and that there would be no significant impact on national economic performance, failed to take into account the decisions that each employer would take at a local level. [393] It submitted the SDA had not explained how the variations proposed for workers under 18 are justified, or offered any reasonable work value based explanation for them. [394] The Pharmacy Guild submitted that pharmacy assistants in the 18 – 20 age group, engaged at the lower classification levels, are more likely to be school leavers with limited life experience or university students not pursuing a career as a pharmacy assistant. [395] As to subsection 157(2A)(a), the Pharmacy Guild submitted that junior pharmacy assistants at Level 1 and 2 often perform more limited duties and in a more supervised way than others. As to subsection 157(2A(b) the Guild submitted junior pharmacy assistants perform work relevant only to their Level 1 or 2 classification level, and that while they may buddy up with new employees to show them how to use equipment (such as operating a register) they do not supervise them. It submitted that under the Pharmacy Industry Award supervisory duties are performed by employees at level 3 or above. As to subsection 157(2A)(c), It submitted pharmacy employers have a different expectation of junior workers including that they may perform more limited tasks and it may take them longer to perform tasks. It submitted employers have a higher level of tolerance for minor mistakes or missed customer service opportunities. [396] In closing, the Pharmacy Guild submitted that the current rates and structure support a training and career progression pathway for pharmacy assistants which is outside those engaged in traineeships. They said that the existing limitation on the employment of juniors, at the lower classification levels, and the limitation that only level 3 pharmacy assistants could supervise level 1 and 2 employees, and the fact that level 3 pharmacy assistants are then paid the adult wage, was enough. They said this arrangement was sufficient, and it worked. They said the SDA and the Pharmacy Guild had agreed to those limitations in 2017, and that the Commission had been satisfied that with the 2017 variation, the Pharmacy Industry Award met the modern awards objective, and it was not necessary to go any further. They said nothing had changed. [2026] FWCFB 75 110 MGA’s submissions [397] The MGA, which opposed the application, filed a written outline of submissions on 11 July 2025222 and made oral submissions at the hearing. The MGA submitted that the proposed variation to the General Retail Industry Award was not necessary to achieve a fair safety net and in fact would undermine the modern awards objective. In particular, it submitted, the variation would: a. Impose significant new wage costs on retailers who are already facing a cost-of doing business crisis, jeopardising the financial viability of many independent retailers. It submitted small, independent businesses are struggling to stay in business, and adding further financial pressure on these businesses will force many to consider drastic operational changes, including the closure of their business. b. Reduce employment opportunities for young people in Australia, particularly in regional locations of Australia. It is likely that businesses will respond by changing their mix of staffing and will hire senior employees in place of junior employees. It submitted junior employees face significant challenges in terms of upskilling and developing in an increasingly competitive job market. These changes would only detriment the cohort the changes are purporting to help. c. Not be justified by work value reasons. The proposals do not suggest there has been any material change in circumstances since previous reviews of junior pay rates. The application is essentially an attempt to resubmit a policy position that the Commission has previously rejected. The SDA does not establish a compelling case to overturn longstanding practices. d. Disrupt the balance of fairness and equity in the award system. While aiming to improve wages for younger workers, it would create new inequities and negative consequences for young people who face a lack of employment opportunities as they are seen as less experienced, engaged and accountable as older staff who are no more costly. [398] The MGA submitted that the Commission should dismiss the application. It submitted the existing junior rates structure in the General Retail Industry Award and other modern awards the subject of the application remains an important feature of a fair and relevant minimum safety net which encourages youth employment, supports business sustainability and reflects the true value of the work performed by junior employees. [399] The MGA also referred us to the General Retail Junior Rates (20-year-olds) decision and submitted that in the intervening period there had been no significant evolution in, or change to, junior employment. The MGA submitted that junior employees still perform work at the same level, have the same level of maturity, the same responsibilities, the same life experience and require the same amount of training and supervision as junior employees did in 2014. For that reason, it submitted that there should be no departure from the discounted rates of pay for junior employees which sensibly reflect the differences in life experience, work 222 Outline of Submissions of Master Grocers Australia Ltd filed 11 July 2025 (“MGA’s outline of submissions”). [2026] FWCFB 75 111 experience, maturity and the additional costs for employers in employing junior employees. It submitted its witnesses’ evidence would show that the variation if made would have a direct impact on the cost of employment and would subsequently disincentivise junior employment. It submitted the variation would serve only to disadvantage young Australians who would have less job opportunities, particularly in regional areas of Australia. [400] The MGA made submissions as to the impacts of the variations, if made, particularly on independent retailers, and young workers aged under 21. It made submissions as to the conclusions to be drawn from its witnesses’ evidence and made some submissions in response to the SDA’s expert evidence. It submitted the variations are not justified by work value reasons and are not necessary to meet the modern awards objective and the minimum wages objective, and provided responses to the SDA’s submissions in that regard. The MGA submitted the SDA had not provided any persuasive evidence or submissions that “substantiate a departure from well understood principles of compensating junior employees.” It submitted the value or nature of work that junior employees perform, and the personal responsibilities of young people have not changed over time and there is no logical explanation as to why junior employees should be compensated at a higher rate. It submitted junior employees still perform work to a lower standard and have less responsibility than adult employees, and the current junior rates system reflects that reality. If the variations were made it submitted businesses that operate on slim margins would find it increasingly difficult to sustain their business, and young people would face increased challenges in finding employment and entering the workforce. Business NSW and Australian Business Industrial’s submissions [401] Business NSW and its affiliated registered organisation Australian Business Industrial filed written submissions in these proceedings.223 We will refer to the two collectively as BNSW-ABI. BNSW-ABI submitted they have membership covered by each of the three awards the subject of this application, and that their primary interest is in the General Retail Industry Award and the Fast Food Industry Award. In their written submissions BNSW-ABI summarised their position as follows (replacing their defined terms with ours for consistency): a) Junior rates are lawful, legitimate and specifically required by the Fair Work Act 2009 (Cth). b) The [Commission] is required to provide a ‘comprehensive range of fair minimum wages to junior employees’. c) 21 years of age (rather than 18) is the appropriate and prevailing threshold for junior rates. If this is to change, it is a question for the legislature. d) Junior rates have long been accepted by industrial tribunals and the rationale and justification for junior rates remains relevant in 2025, particularly in industries where large amounts of juniors are employed. e) Junior rates have been, and can continue to be, justified on work value grounds related to the work performed by junior employees. f) Junior rates serve a vital social objective of incentivising employers to engage young workers who would otherwise struggle to compete with more experienced older workers in the labour market. 223 Business NSW and Australian Business Industrial, Junior Rates: Application AM2024/24 Response, 11 July 2025 (“BNSW-ABI’s written submissions”). [2026] FWCFB 75 112 g) Acceptance of the SDA Application will significantly increase pay rates for most employees receiving junior rates, particularly 17-, 18- and 19-year-olds. h) Acceptance of the SDA Application will remove the primary incentive to engage young people and this will lead to employers engaging less junior employees. i) Acceptance of the SDA Application will lead to employers modifying their rostering practices to align with the varied rate arrangements. Removing or significantly decreasing incentives to engage juniors will adversely affect juniors’ work opportunities. j) The large proportion of junior employees in the [Fast Food Industry Award] and [General Retail Industry Award] particularly will mean that the removal or increase of junior rates will have significant cost implications for employers and those industries more broadly. k) The large proportion and number of junior employees in the [Fast Food Industry Award] and [General Retail Industry Award] will mean that any adverse employment effects on junior employees in these industries will have a material impact on employment opportunities for young people generally. [402] BNSW-ABI relied upon the 1999 AIRC Junior Rates Inquiry report, submitting that the underlying purpose, rationale and utility of junior rates in 2025 remains as it was in the late 1990s. They also referred us to passages of the Productivity Commission Workplace Relations Framework Final Report. [403] BNSW-ABI made submissions as to the statutory framework. As to work value they submitted that subsection 157(2A) of the Fair Work Act does not contain any requirement that the ‘work value reasons’ consist of identified changes in work value measured from a fixed datum point. However, in order to ensure there is no ‘double counting’, it is likely the Commission would adopt an appropriate datum point from which to measure work value change, where the work has previously been properly valued.224 The submitted that subsection 157(2A) does not incorporate the test which operated under wage fixing principles of the past, being that the change in the nature of work should constitute such a significant net addition to work requirements as to warrant the creation of a new classification or upgrading to a higher classification.225 They submitted that in this matter we would focus on the percentages of the adult rate, as opposed to closely examining the underlying classification rates, making this matter different from recent work value proceedings. It submitted there is no basis to suggest that relevant work under the Awards has not been previously properly valued, or that the percentage increments should be varied. [404] As to the exit age for junior rates, BNSW-ABI submitted that under the statutory definition, employees aged under 21 are junior employees. They referred to the Commission’s obligation to maintain a comprehensive range of junior rates (referring to s 284(1)(e) of the Fair Work Act) and said that though they did not go so far as to suggest that provision requires the Commission to set different rates for all employees under 21 years of age, it provides a compelling reason to doubt that it is self-evident that there should be equal pay for all employees of 18 or over. They submitted that the legislature could change, but has not changed, the definition to refer to 18 rather than 21. They also referred us to section 25 of the Age 224 Relying on the Aged Care Stage 1 decision, [170]. 225 Relying on the Aged Care Stage 1 decision, [155]-[163]. [2026] FWCFB 75 113 Discrimination Act, and submitted these provisions reflect the long-standing recognition by the contemporary Australian Parliament that junior wage rates are not a discriminatory relic of a bygone and prejudiced era, but rather serve a legitimate and contemporary function and are worthy of retention. [405] BNSW-ABI provided us with analyses of the effect of each variation, if made in the terms sought. They ABI referred us to the evidence led by others and submitted that the evidence would develop a position that employers: (a) who engage junior employees play an important societal role in providing work opportunities, mentorship, training and experience for young people; (b) currently engage junior employees for reasons which no doubt include the cost advantages of engaging employees on lower rates; (c) experience specific challenges in relation to the engagement of junior employees generally which are different from older employees; (d) will experience financial impacts should the SDA Application be granted; (e) will be less likely to engage junior employees or otherwise will update rostering practices should the SDA Application be granted; and (f) consider the practical effect of granting the SDA Application will be to hurt junior employees, particularly 17-, 18- and 19-year-olds. [406] They submitted that younger workers compared to older workers generally are less mature, less world-wise, less skilled and confident in interacting with a range of customers, clients and staff. They submitted this is not a criticism of young workers but simply an observation about human experience. BNSW-ABI submitted that younger workers become more productive as they age, and that this is recognised by the SDA’s Application in seeking to retain discounted rates for workers under the age of 18 in a 3-step scale. BNSW-ABI also made submissions as to the SDA’s lay and expert evidence. [407] In their response submission, BNSW-ABI made various criticisms of the expert evidence. Among other criticisms of the expert evidence, BNSW-ABI made submissions as to the data used, and the approach taken in respect of various matters. They also submitted that conclusions drawn from international studies should be treated cautiously, and that the Commission should instead have regard to Australian inquiries. They referred us to, inter alia, the 1999 AIRC Junior Rates Inquiry report, the Productivity Commission’s Youth Wages and Employment report (1998),226 its Workplace Relations Framework Final Report, and its research paper Why did young people’s incomes decline?227 226 This was cited as Productivity Commission, Youth Wages and Employment (Research Report, March 1998); on the face of the report it appears to be better cited as Daly, A., Duc, N.H., Eldridge, D., Gabbitas, O. and McCalman, P. 1998, Youth Wages and Employment, Productivity Commission Staff Research Paper, AusInfo, Canberra, October. We will refer to it as “Productivity Commission, Staff Research Paper, ‘Youth wages and Employment’ (1998).” 227 Productivity Commission, Why did young people’s incomes decline? (Research paper, 18 July 2020), 5, 80–81. [2026] FWCFB 75 114 [408] BNSW-ABI also criticised Professor Borland’s expert evidence on the basis that they considered it lacked discussion of labour market displacement, underemployment, or long-term scarring. They did not file their own expert evidence. [409] As to the costs to employers if the variations were made, in addition to their responses to the expert evidence led by the SDA, BNSW-ABI made submissions as to the impact on costs for both large and small employers. They submitted that there are some large employers that extensively engage junior employees. The scale of their engagement of junior employees means that the cost consequences for those large employers will be larger, but also that any removal of the incentive to engage younger workers will have greater impact. They also submitted that small employers, including small regional employers, are the least able to accommodate cost increases. The consequence of these employers deciding against engaging junior employees will be particularly significant in regional areas, where employment opportunities are limited. [410] As to the modern awards objective, and the obligation to provide a fair and relevant safety net, BNSW-ABI submitted junior rates are a relatively unique feature of the modern award system but they are significant and beneficial to all parties including junior employees who are provided opportunities they would not otherwise receive. BNSW-ABI submitted we should be extremely cautious in correlating junior rates with lower relative living standards of those who earn them, and that we can have regard to the fact that young workers are: a) more likely to have no or lower housing costs, being more likely to live with their parents or family members; b) less likely to have dependents including spouses or children; and c) less likely to have significant liabilities including mortgages or health-related expenses. [411] They submitted we should have regard to the fact that their ‘living standards’ and ‘needs’ are very different to adult employees. [412] BNSW-ABI submitted that if accepted, the SDA’s proposals would result in less job security for employees receiving higher rates of pay, particularly those in receipt of a significant increase (most notably 17- and 18-year-olds), and that this tends against the granting of the claim. [413] They submitted the gender equality provision of the modern awards objective is a neutral consideration, as well as the collective bargaining encouragement provision. [414] They submitted the mechanism of junior rates in incentivising the employment of junior employees is significant in relation to the promoting of social inclusion through increased workplace participation. They referred us to the youth unemployment rate, submitting it was more than double the general unemployment rate (relying on the most recent ABS Labour Force release at the time). [415] BNSW-ABI made mixed submissions as to whether the variations, if made, would promote flexible modern work practices and the efficient and productive performance of work. [2026] FWCFB 75 115 On the one hand, they submitted that by disincentivising employment of ‘junior workers’ the variations had the potential to remove from the workforce some unskilled and inexperienced workers. On the other they submitted that replacing junior workers with adults would lead to a less efficient system of engaging and upskilling young workers in paid employment. [416] It submitted the provision regarding the need to provide additional remuneration for various categories of employees not to be relevant to this matter. [417] They submitted that the variations would have significant adverse effects on employers, telling against granting the application. [418] They submitted the provision in respect of the need to ensure a simple, easy to understand, stable and sustainable modern award system for Australia that avoids unnecessary overlap of modern awards is not a particularly relevant limb with respect to these proceedings. However, it submitted further departure from the legislative definition of junior employee is apt to create a less understandable modern awards system as well as resulting in awards which identify the seemingly redundant obligation to pay most junior employees 100% of the adult rate. [419] In respect of the provision relating to employment growth, inflation, and the national economy they relied on their response to the expert reports. ACCI’s submissions [420] The Australian Chamber of Commerce and Industry sought that no change be made to the existing junior rates in determining this application. It made written submissions228 in opposition to the application, which they indicated were intended to support and complement the ARA’s submissions. ACCI did not lead evidence. It opposed the application on the basis that granting the application would be inconsistent with the objects of the Fair Work Act. It referred us to previous occasions on which applications regarding junior rates had been considered by the Commission and its predecessor tribunals. It made submissions as to the factors supporting the continuation of the current junior rates framework including submissions as to the effect on employment and small businesses if the application were to be granted. It also addressed what they considered to be common misconceptions about junior rates. [421] In its submissions as to the Fair Work Act’s objects, ACCI provided us with an analysis of what it considered to be the most relevant provisions in sections 3, 134 and 284. In doing so, it addressed employment and employment growth, productivity, cost implications and their effects on small businesses, business sustainability and competitiveness, and the current level of insolvencies and financial stress on business, stability and sustainability of the modern awards system, potential inflationary effects of wage increases and the effect on consumers, and the nature of a safety net. [422] Turning to the history of consideration of junior rates, ACCI submitted that though there was no principle of stare decisis in the Commission, the Commission would generally follow previous Full Benches in the absence of cogent reasons for not doing so, as a matter of policy 228 Australian Chamber of Commerce and Industry, Submissions, filed 11 July 2025 (“ACCI’s written submissions”). [2026] FWCFB 75 116 and sound administration.229 They then referred us to the 1999 AIRC Junior Rates Inquiry report, the General Retail Junior Rates (20-year-olds) decision,230 and the General Retail Junior Rates (Classifications) decision. [423] As to the argument for retaining junior rates, ACCI submitted that wages reflect total value and not just task equivalence. It submitted there are a variety of factors that make employees, up until the age of 21, less appealing to hire compared to older workers - lower wage rates seek to offset these factors and establish a fair minimum wage. It also submitted that it is likely that younger employees will be less productive than their older counterparts,231 and less mature. It submitted younger employees tended to have greater variability in their availability and exhibit higher turnover rates than older employees. [424] In respect of living standards and the needs of the low paid, ACCI submitted that a growing (though stable since 2010) number of young Australian adults continue to live at home with their parents, resulting in living standards and financial responsibilities that differ greatly from those of older Australians.232 It submitted that it is self-evident that by living at home young people enjoy higher living standards and are less burdened by the costs of daily living. In that regard ACCI also referred us to the SDA’s lay evidence. It submitted that for the minority of young people who live independently, the modern award system of wages and the national minimum wage are a safety net that is extraordinarily generous by international standards. It also submitted that it is common for young people living independently to live in share houses233 where rental costs are diluted. It also referred to social supports available to young people and submitted it was not the duty of the Commission to bridge any gaps in that support by variations to modern awards. [425] In relation to employment ACCI relied on first principles, that an increase in wage price would lead to a reduction in demand for labour. It also referred us to the observation in that regard in the Productivity Commission Workplace Relations Framework Final Report 2015.234 It submitted that demand for junior employees is likely to be “particularly elastic,”235 and that any increase in wages is likely to have a level of negative impact on youth employment and workforce participation. ACCI also referred in their submissions to an unnamed franchisor that had surveyed its franchisees about the application. However, ACCI did not seek to adduce the survey or its output into the evidence and did not otherwise provide us with a copy. ACCI submitted that young employees are often the first to lose their jobs as business margins shrink, 229 Relying on Cetin v Ripon Pty Ltd [2003] AIRC 1195; (2003) 127 IR 205 (Ross VP, Duncan SDP and Roberts C), 214 [48]. 230 With particular reference to paragraph [104] of that decision. 231 Citing Productivity Commission Workplace Relations Framework Final Report, Volume 1, 254. That part of the report indicates that young people have varying productivity, and that the least productive will be more affected by high junior rates. 232 Relying on Melbourne Institute, The Household, Income and Labour Dynamics in Australia Survey: Selected Findings from Waves 1 to 21 (2023), 21. 233 Relying on a source referred to as “Flatmates, 2019 National Share Accommodation Survey Results” which appears to be a reference to Flatmates.com.au. 234 Productivity Commission Workplace Relations Framework Final Report, Volume 1, 254, which referred to employment effects and indicated the least productive junior employees would be more greatly affected by high junior rates. 235 Relying on Lewis, P.E.T. & MacDonald, G., The Elasticity of Demand for Labour in Australia (2002), and Productivity Commission, Staff Research Paper, ‘Youth wages and Employment’ (1998), 65. [2026] FWCFB 75 117 referring to the downturn associated with COVID-19.236 It submitted that if granted this application would increase business costs, creating pressure on business viability and margins, creating the potential for job losses, which would fall disproportionately on young workers. It submitted any benefit from an increase in junior rates would be moot if junior employees are not employed in the first place. It submitted that the youth unemployment rate is more than double that of the general population (9.0% compared to 4.0% at the time of the written submissions),237 and that the focus in relation to youth employment should be on matters and initiatives away from the modern award system. [426] ACCI also made submissions as to the consequences of reduced workforce access for young people, submitting that youth unemployment is associated with reduced economic mobility, widening skills gaps and long-term disadvantages, that young people who have been unemployed find it harder to get steady work than those who have been working,238 and that early and sustained engagement in employment improves long-term career prospects and reduces disadvantage.239 It referred us to a Productivity Commission observation that changes that affect employment of the less academically able could have adverse generational impacts.240 [427] ACCI made submissions as to the particular effect on small businesses if the application was to be granted. Referring us to statistics reported by the Australian Small Business and Family Enterprise Ombudsman,241 ACCI submitted that 97.2% of all Australian businesses are small businesses, and that small businesses have tight profit margins, with a substantial minority operating at a loss in 2023, and with 75% of small business owners taking home less than the average wage. It submitted increased costs could force small businesses to reduce staff hours, cut back on hiring, or pass the costs on to consumers, each of which would have undesirable economic consequences. It submitted that, alternatively, small businesses could be forced to close altogether. [428] ACCI made submissions as to whether junior rates are discriminatory. It submitted that discrimination should be illegal where there is no basis for making distinctions between categories of people, for example, on gender or race. As to junior rates, it submitted that junior rates were excluded from legislative definitions of discrimination, referring us to subsection 153(3) of the Fair Work Act and section 25 of the Age Discrimination Act. It also referred us to section 351 of the Fair Work Act and section 18(4) of the Age Discrimination Act, submitting that those provisions permit discriminatory provisions if they align with the ‘inherent requirements’ of the employment. It submitted this is consistent with Article 1 of the ILO Convention no. 111. It submitted that junior rates are lawful and non-discriminatory. 236 Relying on Littleton, E. & Campbell, R., Australia Institute, ‘Youth unemployment and the pandemic’ (2022), 17. 237 Relying on Australian Bureau of Statistics, Labour Force, March 2025. 238 Relying on Productivity Commission Workplace Relations Framework Final Report, Volume 1, 254. 239 Referring us to, for example, Cassidy, N., et al, Reserve Bank of Australia, ‘Long-term unemployment in Australia’ (2020), 6. 240 Referring to Productivity Commission Workplace Relations Framework Final Report, Volume 1, 258. 241 Australian Small Business and Family Enterprise Ombudsman, Number of small businesses in Australia (June 2024) and Australian Small Business and Family Enterprise Ombudsman, Small Business Matters (2023), 1. [2026] FWCFB 75 118 [429] ACCI submitted that comparisons with other countries should not be made, in relation to the use of junior rates, where Australia has entirely different labour market and economic contexts. However, it submitted that even if such comparisons were made they did not support the argument to increase or remove junior rates. It made submissions as to the experiences in New Zealand242 and South Korea. Franchise Council of Australia’s submissions [430] The Franchise Council of Australia is an association of franchise businesses. It opposed the application and made written submissions in opposition, dated 4 July 2025. The Franchise Council did not seek to adduce any evidence in these proceedings. [431] The Franchise Council filed written submissions.243 It submitted that franchising across Australia represents some 73,000244 small businesses that are in the most part made up of husbands and wives, small family units, relatives and others who support the franchisee in operations of the business. It submitted a large part of this eco-system and relationship fosters the important opportunity for young Australians to find a pathway to their first job. [432] The Franchise Council submitted that the franchising model lends itself to create these opportunities and have structured and complex training systems in place to enable small business to enable these jobs which might otherwise be difficult for a small business due to the pressure of and cost of training a young person in a new role. Some of these roles have safety risks, hygiene risks, performance requirements and technical skills which can all be trained on the job but done so in a way to enable the young person to launch their careers. [433] It submitted these young people may in fact go on to be supervisors or managers and, in some cases, (which is common in franchising) become a franchisee in their own right, an entree to entrepreneurship. Of course, in other cases the entry level role is just that and the young person may go onto study in a completely different field in a trade, certificate course or university. It submitted that if you ask many people in modern society, “where did you get your start in work life” the response in many cases will connect to a franchise business. [434] The Franchise Council submitted that junior rates of pay are a structural imperative to enable small business owners in franchising with the ability to afford to employ a young person, while allocating the time, effort, energy and enthusiasm needed to train them into the role and supervise them in such a way that they can thrive over those first three to four years as a casual or part-time employee. It submits the removal of the junior rate classification would result in an entire re-configuration of the approach franchisees take to junior employment and disrupt the model that has worked so well and enabled thousands of young Australians to get their first job which they otherwise would not have been considered for, if the choice was based on age as a comparative to the rate of pay. 242 Referring us to New Zealand Youth Unemployment Rate (1991-2024), Macrotrends (which we take to be a reference to the website macrotrends.net) and Beehive Government New Zealand, The Starting-Out Wage: Q&A’s (October 2012), 1, which appears to us to be a New Zealand Government document. 243 Submissions by Franchise Council of Australia dated 4 July 2025 (“Franchise Council’s written submissions”). 244 citing Schaper, M., “Review of the Franchising Code of Conduct Final Report,” a report to the Australian Government dated December 2023, which derives the number of franchisees from the Australian Government’s Franchise Disclosure Register as at 14 September 2023. [2026] FWCFB 75 119 [435] The Franchise Council submitted it is not reasonable to suggest that a new teenager starting out in their first job is capable or prepared to do the same job as a person who might be 4 to 6 years older. It submitted that “teenage years are informative years, and the young person is likely to be still at school, studying, playing sport, developing interpersonal relationships and finding their way in life.” It submits that aspects of maturity, shift availability, flexibility, anxiety, self-belief and tenacity are all factors either still being developed by a teenager or flexibilities applied by the franchisee. It submitted that in so many cases the franchisee becomes a sounding board for this employed young person to gain these skills while at work and helps to support them as they develop. The Franchise Council submitted that this “entry level workforce” has been an important source of employees in an ever more complicated and currently reduced workforce, and told us that it hoped that would continue to be the case. [436] The Franchise Council submitted junior rates of pay enable small business to deploy recruitment strategies to continue to seek employees to carry out the job functions necessary to operate their business. It submitted young people on junior rates perform different job formats across different verticals within franchising. The roles in which juniors fill are very entry level and often carry the simplest repetitive tasks in order to maximise the output, enable the young person to thrive and learn while contributing to the team effort within the business. [437] It submitted that a structural change to the rates of pay or the removal of “the junior rates construct” would have a material impact of how franchising seeks to support young Australians wanting to enter the workforce and learn lifelong skills provided in such settings. Authorities and literature to which the parties referred us [438] In addition to providing us with relevant authorities, parties and their expert witnesses have referred us to a range of research materials from international organisations, government agencies and bodies, academic sources, and others, without calling the authors of those documents, an exercise that would have been impractical. We are able to inform ourselves as we consider appropriate, and at the same time must conduct these proceedings openly and transparently. The parties have had ample opportunity to read each other’s submissions and are on notice of the research materials referred to in those submissions. We have taken the literature they have referred us to into account, giving the materials appropriate weight bearing in mind the nature of each item (for example, whether the author is a government body, and whether, for academic articles, the source provided has been peer-reviewed) including its author(s), and the absence of an opportunity to test any assertions where authors have not been called. [439] We were referred to reports produced by government agencies, including the Australian Bureau of Statistics, and publicly funded but independent bodies including the Reserve Bank of Australia, the Productivity Commission and the Australian Small Business and Family Enterprise Ombudsman. We were also referred to publicly-funded materials produced by non- government institutions, including the Household, Income and Labour Dynamics in Australia (HILDA) Survey, conducted by the University of Melbourne and funded by the Commonwealth. To the extent such reports contain empirical research we consider they can generally be given weight. Where they contain modelling, prediction, policy recommendations or opinion we have approached them with appropriate caution. [2026] FWCFB 75 120 [440] Some of the evidence or submissions referred to material produced by international organisations including the International Labour Organisation, and the Organisation for Economic Cooperation and Development. We have treated these similarly to reports produced by domestic government and government-funded agencies. [441] The parties also referred us to a significant body of domestic and international academic literature. Many of the concepts considered in the academic literature put before us are contested. We have had the benefit of hearing expert evidence as to many of the issues canvassed in the academic literature. As mentioned above we have taken into account whether a given item, to which we have referred, has been peer-reviewed. [442] We have been referred to some unofficial, privately-produced, and/or secondary sources. Where secondary sources involve peer-reviewed or officially produced meta-analyses of primary sources they have been of some assistance, though we have continued to exercise caution in relation to them. Where sources, primary or not, appear to have been produced by private interests, non-government think-tanks, or the like, we have not found them to be of significant use in the absence of direct or expert evidence, even if we have referred to them when summarising parties’ submissions. [443] We have been referred to some surveys. ARA filed a witness statement annexing a survey, which was the subject of objection at hearing and which we have discussed below. For reasons above we have been able to take into account some formal or official surveys and their results (such as those conducted by the ABS, as well as the HILDA survey). Where other surveys have been referred without any evidence being adduced as to their design, rigor, or significance, we have treated them with a high degree of caution. Consideration [444] Our consideration follows. We first consider an argument raised by employer groups regarding whether it is necessary to deal with the proposed variations outside the Annual Wage Review. We then turn to the legislative and arbitral origins and history of junior rates. We then consider work value, the modern awards and minimum wages objectives, and other necessary matters. Necessity of determination outside the annual wage reviews system [445] As we have indicated above Ai Group submitted that the requirement of necessity in section 157(2) of the Fair Work Act is fatal to the application to vary the three awards in these proceedings.245 The ARA submitted that it was not necessary to determine this application outside the annual wage review process. In addition, the Ai Group246 and the ARA247 submitted that variations to junior rates ought to be a matter for the parliament. The Ai Group also submitted the matter should at least be dealt with by an Expert Panel, “just like you see in an annual wage review.”248 245 See also PN4794 and following. 246 PN1174; PN4791. 247 PN5110. 248 Ai Group’s outline of submissions, [19]; PN1174, PN4791. [2026] FWCFB 75 121 [446] We do not accept these submissions. For the reasons set out below, we are satisfied, in respect of each of the three awards, that making a determination varying modern award minimum wages (in respect of certain junior employees) is necessary to achieve the modern awards objective. We are also satisfied that doing so is necessary to achieve the minimum wages objective. We are also satisfied, in respect of each of the three awards, that making the determination outside the system of annual wage reviews is necessary to achieve the modern awards objective (and to achieve the minimum wages objective), having regard to the statutory scheme, the nature of the task before us, and the nature of annual wage reviews. [447] The consideration of the term “necessary” in the context of s 157(2), in Shop, Distributive and Allied Employees Association v National Retail Association (No 2),249 is relevant to our consideration of whether we are satisfied as to the necessity of making the determination outside the annual wage review system. This question of necessity should be considered having regard to the current statutory context, including the repeal of four yearly reviews. We found the authorities to which we were referred, in relation to necessity in other statutory contexts, to be of less assistance to us. [448] Each of the jurisdictional prerequisites in section 157(2) is expressed in terms of the Commission’s “satisfaction.” As indicated above this requirement involves an element of subjectivity and is a matter about which reasonable minds may differ. It requires the formation of a broad evaluative judgment involving the exercise of a discretion.250 [449] The need for a power to vary award minima outside the annual wage review system is self-evident. The Expert Panel conducting the annual wage review cannot as a matter of both practicality and efficiency review every award in detail every year, and nor could such a demand be made of parties who contribute to that process. Even reviewing every award every four years was not feasible, as was acknowledged by the parliament when it repealed the requirement for four yearly reviews. Nor is the annual wage review process apt for detailed consideration of the sort needed to make decisions in relation to work value in the context of particular awards. Reviewing the junior rates in only three awards in this case has involved a process of more than eighteen months, several days of hearing before a Full Bench, extensive case management, and a substantial amount of evidence. [450] Recognition of the necessity of conducting separate, specific proceedings outside the annual wage review system is not new. For most of the history of wage-fixing in the Commonwealth jurisdiction, award minimum wages have been fixed by a combination of period reviews and specific proceedings. The Full Bench, in the 1999 AIRC Junior Rates Inquiry report, considered the history of alterations to junior rates. Summarising that history in that inquiry the Full Bench said251 that from the 1960s to the present, the basis of the Commission’s approach to fixing junior rates had been case-by-case. They then said252 that since 1985, national wage benches, in response to general issues on junior rates raised by the parties about junior rates, had generally confirmed the case-by-case approach. They said the 249 at [35]-[37], and [46]. 250 Coal and Allied v AIRC [2000] HCA 47; (2000) 203 CLR 194, [18]-[20], [28] (Gleeson CJ, Gaudron and Hayne JJ). 251 1999 AIRC Junior Rates Inquiry report, [2.2.55(vi)]. 252 1999 AIRC Junior Rates Inquiry report, [2.2.55(vii)]. [2026] FWCFB 75 122 main exception had been initiated by the Furnishing Trades Case 1994.253 This initiative had resulted in the adoption of the National Training Wage and the making of the National Training Wage Award.254 [451] It is not surprising that case-by-case variation has previously been the general approach as it is more practical. In 1991 the Commission accepted a submission by the (then) Confederation of Australian Industry that junior rates should be dealt with outside the national wage case, saying the matter could be dealt with at another time when youth wages could be more fully debated. The Full Bench in that case said the matter could be raised by a specific application which would “necessarily” be dealt with in a special case.255 The Full Bench in the 1999 AIRC Junior Rates Inquiry report also took the view that junior rates should be considered on a case-by-case basis.256 [452] As indicated above, in the modern era since the enactment of the Fair Work Act, until recently, the Commission was able to deal with award-specific variations in the course of four yearly reviews, and was also able to deal with them on a case-by-case basis outside the reviews if necessary under section 157 as initially enacted. [453] The variation decisions we have referred to in these proceedings – the 2014 General Retail Junior Rates (20-year-olds) decision, the 2020 General Retail Junior Rates (Classifications) decision, and the 2017 Pharmacy (Junior Rates) decision – were decided outside the annual wage review system. The General Retail (20-year-olds) decision was made in the context of the 2012 review under the Transitional Provisions Act. The 2017 and 2020 decisions were made in the course of the four yearly reviews that were still underway at the time. As we have indicated above, prior to the repeal of the four yearly reviews provisions, section 157 had required the Commission to be satisfied that variation was necessary outside the system of annual wage reviews and the system of four yearly reviews. Under that regime the junior rates matters were decided outside the system of annual wage reviews, via the four yearly reviews. Thus, the case-by-case approach has persisted under the Fair Work Act. [454] As can be appreciated from the Revised Explanatory Memorandum to the Fair Work Amendment (Repeal of 4 Yearly Reviews and Other Measures) Bill 2017 (Cth) these four-yearly reviews were removed because, inter alia, conducting them was not feasible having regard to their resource intensity. It stated:257 “Recommendation 8.1 of the [Productivity Commission’s Final Report into the Workplace Relations Framework] is, in part, to repeal the requirement for the FWC to conduct 4 yearly reviews. The PC Report notes that in practice, the 4 yearly reviews placed substantial demands on parties and the process does not meet the Act’s objective to create a simple, easy to understand and sustainable award system. The 4 yearly review mechanism is too resource intensive for both the FWC as well as employer and 253 Re Furnishing Trades Award [1994] AIRC 1724; Print L5963 (October 1994). 254 See Re National Training Wage Interim Award [1994] AIRC 1408, Print L5188. 255 National Wage Case April 1991 [1991] CthArbRp 324; (1991) 4 CAR 204; J7400, 57. See also the April 1985 National Wage Case and the Review of Wage Fixing Principles [1994] AIRC 1249; L4700. 256 1999 AIRC Junior Rates Inquiry report, [2.2.26]. 257 Revised Explanatory Memorandum to the Fair Work Amendment (Repeal of 4 Yearly Reviews and Other Measures) Bill 2017 (Cth), [5]-[7]. [2026] FWCFB 75 123 employee organisations taking part in the review. The PC Report notes that while the FWC is streamlining the review process, reform is required. Schedule 1 to the Bill repeals the requirement for the FWC to conduct 4 yearly reviews of modern awards from the beginning of 1 January 2018. Further amendments ensure that the residual framework for the making, varying and revoking of modern awards under Division 5 of Part 2-3 of the Act continues to require that the FWC is satisfied that making a determination is necessary to achieve the modern awards objective. This framework allows changes to a modern award where emerging social and economic matters demonstrate that change is necessary. For example, in exercising its modern award functions, the FWC is required to take into account a range of criteria, such as the need to promote social inclusion through increased workforce participation. This requires the FWC to consider the changing labour market and the manner in which work is evolving. It must also promote flexible modern work practices and the efficient and productive performance of work, which again requires the FWC to look beyond the way work has been performed historically and to make sure the safety net of terms and conditions continues to meet community expectations.” [455] Having regard to the foregoing the parliament appears to have contemplated that matters under section 157 would fill or substantially fill the vacuum left by the repeal of the four yearly reviews. It seems unlikely that the Parliament would have intended, when it repealed the four yearly reviews, to materially increase the demands on the Expert Panel when deciding Annual Wage Reviews, by broadening the scope of its task to require it to deal with award-specific work value issues in the course of the annual wage reviews system. That would have been a perverse outcome for a policy measure aimed at reducing the resourcing demands on industrial parties, the Commission, and the staff of the FWC. It also would have been a radical departure from the approach that has persisted for decades of conducting both general reviews and award- specific variation cases. If this was intended, the legislature would have said so clearly. Instead the statute simply indicates, by legislative note,258 that the main power to vary award minimum wages is found in Part 2-6. The power under Part 2-6 is the main power because award minimum wages are likely to be altered more frequently by annual changes of general application, than by case-by-case changes requiring extensive individual consideration. [456] The Explanatory Memorandum to the Fair Work Bill 2008 (Cth) stated that the annual wage review was to be the main way in which wages would be set and varied by the Commission,259 with variation of minimum award wages, in a 4 yearly review, for work value reasons, to be “a limited exception”260 to this approach, and with Division 5 setting out “limited circumstances”261 in which modern awards may be made, varied or revoked outside both the annual wage reviews and 4 yearly modern award reviews. These limited exceptions allowed the Commission to deal with variations in relation to work value262 outside the annual wage- fixing process. Repealing the four-yearly reviews provisions has meant that the only power to 258 See Fair Work Act s 135(1), n 1. 259 Fair Work Bill 2008 (Cth) (“Fair Work Bill”), Explanatory memorandum, [605]. 260 Fair Work Bill Explanatory memorandum, [605]. 261 Fair Work Bill Explanatory memorandum, [609]. 262 See Fair Work Act subss 156(3)-(4) and 157(2) as originally enacted. [2026] FWCFB 75 124 vary award minimum wages, for work value reasons, outside the annual wage review is the power provided for by section 157. Section 157 provides for the power to vary award minimum wages. Part 5-1 does not reserve the exercise of such power to any Expert Panel. This is in contrast to the various types of proceedings for which an Expert Panel is required.263 We do not agree that this matter ought to be dealt with by an Expert Panel. We do not consider that the existence of the Expert Panel provisions militates against our finding that it is necessary to make the determination(s) outside the annual wage reviews system. We also do not accept that the question of whether to vary junior rates is more appropriately a matter for the parliament. [457] The SDA submitted264 that having regard to the Real Estate decision, which referred to looking at the particular award and the particular conditions, it only made sense that the Commission could deal with variations to minimum wages on an award-specific basis. It submitted the fact that there is an annual wage review under which junior rates are reviewed every year does not mean that an application such as this could not be made, and it does not stand in the way of an application such as this succeeding.265 We accept this submission. [458] In these proceedings, we agree with the SDA’s submission that the Annual Wage Review would be an inapt vehicle for dealing with proposed variations to provisions in the General Retail Industry Award, the Fast Food Industry Award, and the Pharmacy Award in relation to junior rates. Indeed, the matter goes beyond inaptness. The nature of these current proceedings, the extensive amount of evidence, and the substantial number of hearing days demonstrate how impractical it would be to ventilate and consider the work value, modern awards objective, and minimum wages objective considerations specific to the proposed variations of these three modern awards in the course of the Annual Wage Review. There is no doubt it has been necessary to consider this application in separate proceedings. In respect of each of the three awards we are satisfied that making the determination outside the system of annual wage reviews is necessary. [459] Having considered the Ai Group’s and the ARA’s submissions, as well as Parts 2-3, 2- 6 and 5-1 of the Fair Work Act, we do not consider that an application such as this should be heard only by an Expert Panel. Nor do we accept that this aspect of the statutory scheme (i.e. providing that some types of proceedings to be determined by an Expert Panel only) militates against a finding that it is necessary to make the determinations sought in the present proceedings outside the system of Annual Wage Reviews. [460] We consider our conclusion in this regard – that we are satisfied as to the necessity of making the determinations outside the annual wage review system – to be consistent with the decision of the Expert Panel in the Annual Wage Review 2025 Decision (which was of course decided after the repeal of the four yearly review provisions).266 In that decision the Expert Panel acknowledged these proceedings were being conducted separately. [461] For the reasons we have set out above, and having regard to our consideration and conclusion below, we are satisfied, in respect of each of the General Retail Industry Award, the 263 Fair Work Act s 617. 264 PN4548. 265 PN4548. 266 Annual Wage Review 2025 Decision, [80], [120]. [2026] FWCFB 75 125 Fast Food Industry Award, and the Pharmacy Industry Award, that it is necessary to make the respective determinations outside the system of annual wage reviews. [462] Having decided the issue of the necessity of making a determination varying modern award minimum wages, in respect of each of the three awards, outside the system of annual wage reviews, we now turn to our consideration of the application and the variations sought. We commence by referring to the parties’ submission as to the origins and history of junior rates, and the relevance, if any, thereof. Legislative and arbitral origins and history of junior rates [463] The SDA took us to the history of junior rates and the rationales relied upon in setting them. In contrast the ARA submitted that because the Fair Work Act explicitly provided for junior rates, and because the Commission’s assessment of work value reasons does not require consideration of whether historically the work of junior employees has been undervalued because of assumptions based on age, it is not necessary, or appropriate, for the Commission, in the context of this confined application, to review the industrial jurisprudence and the historical rationale for the application of junior rates to employees under the age of 21 in Australia, and to determine whether junior rates have historically been based on "prejudicial assumptions and industrial convenience,” as the SDA had submitted. It also submitted that such consideration was not necessary in circumstances where a Full Bench of the Commission, in considering the rates for 20-year-olds under the General Retail Industry Award, had acknowledged that the rationale for junior rates of pay remains relevant, and that discounted rates continued to be justified, and that this was particularly so in the retail industry. Nonetheless the ARA took us to the recent history including the General Retail Junior Rates (20-year-olds) decision (2014), and the General Retail Junior Rates (Classifications) decision (2020), both in relation to the General Retail Industry Award, and also submitted:267 “In light of the above, and noting that no additional evidence has been led to specifically warrant the departure from the Full Bench’s findings regarding 20 year olds with six months or less experience, it is not clear how the removal of junior rates for that cohort is now justified. Further, it is clear from the history that junior rates are a longstanding feature of the regulation of wages in Australia. In considering whether the variation is “justified" by work value reasons or “necessary" to achieve the modern awards objective, the Commission should take into account that the proposed variations would significantly disrupt an industrial practice which has been accepted over the last century.” (emphasis in original) [464] On the other hand, the Ai Group submitted that we should not lightly assume that the Commission and its predecessors have for some 70 years or so abdicated their responsibility (because it was “industrially convenient”) to set properly-fixed minimum rates, comply with the modern awards and minimum wages objectives when first making the Awards, comply with those same objectives when conducting 4 yearly reviews of those Awards, or comply with those 267 ARA’s closing submissions, [104]. [2026] FWCFB 75 126 objectives in its conduct of annual wage reviews.268 It said this was especially so in relation to the General Retail Industry Award given that at the time it was first made and on two occasions subsequently269 the existence and structure of junior rates in that award were specifically considered by the Commission, and as a result of that consideration, the junior rates now appeared in their present form.270 [465] We agree with the ARA that the Fair Work Act does not require us to consider whether there has been historical undervaluation based on age, in the same way as is required for gender. We also agree the Fair Work Act explicitly contemplates junior rates. However, we do consider it useful to set out early legislative and arbitral origins of minimum rates for young workers, set by reference to age, as well as the evolution of junior rates in more recent decades, not for the purpose of considering whether there has been historical undervaluation because of assumptions based on age, but to assist us in our broad, evaluative tasks before us, and also to assist us in considering submissions we received about issues such as the desirability of consistency with previous decisions. State jurisdictions [466] The SDA submitted that minimum rates and working conditions for young employees have been a feature of the Australian wage setting system since its inception, with the setting of ‘junior rates’ closely following the development of minimum wages in Australia since 1896. It submitted that the Victorian Factories and Shops Act 1896 (Vic), for the first time, set a minimum wage and established Wages Boards in particular industries operating in the colony of Victoria. It submitted these innovations were widely accepted to be the setting of Australia’s first minimum wage and were followed by other states adopting a similar model and establishing their own tribunals or wages boards between 1900 and 1910, including the Commonwealth in 1904. [467] The Factories and Shops Act 1896 (Vic) had introduced a minimum wage for anyone working in a factory or work-room.271 The bill as initially drafted had confined the minimum wage to women and children, who were considered especially vulnerable to “sweating”, but this was amended before the bill was passed. Victoria was the first Australian jurisdiction to enact a legislative minimum wage. The Factories and Shops Act also provided for wages boards (known as “special boards”) in industries known for “sweating” including clothing manufacture and boot-making. The special boards could set, inter alia, wage rates by making awards. In 1897 that Act was amended to make explicit that the wages boards could set different rates for different “persons or classes of persons" and different rates having regard to "the age and the sex of the workers," with the Minister’s second reading speech stating, “So if any special board chooses to fix a lower rate for old men or lads and a higher rate for skilled operatives this alteration will enable that to be done.”272 In 1900 and in 1905 the power to establish wages boards was broadened, so that after 1905 boards could be established in any industry by 268 Ai Group’s outline of submissions, [27]. 269 A reference to the General Retail Junior Rates (20-year-olds) decision and the General Retail Junior Rates (Classifications) decision. 270 Ai Group’s outline of submissions, [28]. 271 Factories and Shops Act 1896 (Vic) s 16. 272 Parliament of Victoria, Legislative Assembly, Hansard, 27 August 1897, 2008 [2026] FWCFB 75 127 parliamentary resolution. After that, shop assistants (retail clerks) could have minimum wages set by a special board. In Victoria, wages boards were replaced by conciliation and arbitration boards in 1981.273 Victoria’s private sector awards expired on 1 March 1993 by operation of the Employee Relations Act 1992 (Vic) and there had been federal instruments in force in the intervening periods. Prior to award modernisation, the Retail Trade Industry Sector - Minimum Wage Order - Victoria 1997 had provided for junior rates starting at 50% for under-sixteens rising to 90% for 20-year-olds. This instrument was among those considered to be in the retail industry, for the purposes of that award modernisation process that preceded the making of the three awards the subject of this case. [468] Queensland awards had their origins in minimum rates under the Factories and Shops Act 1900 (Qld) (replacing previous factories and shops legislation), and awards made by wages boards274 under the Wages Boards Act of 1908 – 1912 (Qld) and the Industrial Peace Act 1912 (Qld). In 1900, Queensland introduced a statutory minimum wage for persons aged under 21 years, working in a factory or otherwise in manufacturing, after one month’s probation.275 The minimum wage provision had not been in the original bill but added by an amendment. The mover of the amendment said its object was to provide that young persons who were employed in factories should receive some small wage for the work they performed. He said it had been pointed out in the reports of the Chief Inspector of Factories that a large number of young persons were employed in factories who received no wages for their labour. He said it was a practice in Brisbane, not in all factories, but in some, to take on a large number of persons for six or twelve months, and after that to discharge them and engage other young persons in their place.276 The minister at the time expressed some ambivalence and did not advocate either for or against the amendment, which was ultimately passed and incorporated into the Act as made. This was Queensland’s first minimum wage, which is to say, junior minimum wages predated adult minimum wages. In 1908, the minimum for people under 21277 was extended to cover shops as well as factories. At the same time, the parliament added another, much higher, minimum rate for workers 21 or older with four years’ experience in shops or factories. At the same time the parliament passed legislation to establish wages boards.278 Under the Wages Board Acts 1908-1912 (i.e., as amended in 1912) there were various classes of workers who could accept wages lower than the adult award rates, either because the wages board prescribed lower rates, or because of licences issued in certain circumstances. Those classes included apprentices, improvers, young workers,279 and slow, old or infirm workers. Wages boards could set special award rates (as well as ratios and working hours) for apprentices, improvers, and young workers,280 though, in the case of young workers, special rates could not be set for skilled work.281 Apprentices and young workers were, at the time, by definition, aged under 21, but a 273 By operation of the Industrial Relations Act 1979 (Vic). 274 Such as the Award of the Brisbane Shop Assistants’ Board published in the Queensland Government Gazette of the 4th of August, 1915 and the Award of the Industrial Board for Shop Assistants for the South-Eastern Division, published in the Queensland Government Gazette of the 16th of March, 1916. 275 Factories and Shops Act 1900 (Qld), s 45 276 Hansard, Queensland Parliament, 28 November 1900, [2188]. 277 Factories and Shops Act Amendment Act 1908 (Qld), s 12. 278 Wages Boards Act 1908 (Qld). 279 A statutory definition of “young worker” was enacted in 1912 in the by the Wages Boards Act Amendment Act 1912 (Qld). 280 Wages Boards Acts 1908-1912 (Qld), s 21. 281 Wages Boards Acts 1908-1912 (Qld), s 21(1). [2026] FWCFB 75 128 person aged 21 or older could be licenced to work as an improver. A person who was “old, slow, or infirm” could be licenced, for twelve months, to work at a lower wage specified in the licence. The 1913 shop assistants’ awards provided for a scale of rates for “apprentices and improvers” up to age 21, as well as a separate scale of age-based rates for all workers aged 21 to 24 or over.282 The successor award of March 1916 referred to junior and senior employees instead.283 The definition of “young worker” was not materially changed by the Industrial Peace Act 1912 (Qld), but the Industrial Arbitration Act 1916, assented to in December that year, provided a young worker was any person (other than an apprentice or an improver) under eighteen years of age, or, with the approval of the Minister, a female under twenty-one years of age, who received a lower wages price or rate than that fixed by any award for ordinary adult employees.284 [469] South Australia passed its conciliation legislation in 1894, providing for boards of conciliation.285 In 1900, it amended its factories and shops legislation to provide for a minimum wage and wages boards for manufacturing workers, and also allowed for aged and infirm workers to be licensed to work at special rates. The wages boards were not given effect until 1905, and only in relation to female workers, and to male workers aged under 21. The South Australian compulsory arbitration legislation was passed in 1912.286 [470] The Industrial Arbitration Act 1901 (NSW), which had a broad definition of industrial matters which included reference to the employment of children and young persons,287 predated the creation of wages boards in 1908.288 These wages boards were different to the other states’ because they covered industrial matters generally and heard evidence and made decisions arising from it, rather than only reaching agreement through conciliation. The boards’ statutory powers included a provision that a board may “fix the number or proportionate number of apprentices and improvers and the lowest prices and rates payable to them. Such prices and rates may be according to age and experience.”289 The SDA referred us to Shop Assistants Union v. Master Retailers Association and Mark Foy290 and submitted this was the earliest example of a court setting rates of pay for young workers in the retail industry, which at the time included chemists’ stores. In that case the President considered whether to fix wages based on age or experience. He considered that if a system of apprenticeship could be introduced, the case would have been simple, but this could not be done and had been abandoned. In the circumstances he found that the scale could not be based on age or experience alone, but that they must be combined.291 He said when a worker begins early there is no trouble, as the worker grows in age and experience together. He considered the evidence showed it took nine years 282 Award of the Shop Assistants Board for the South Eastern Division, dated 17th October, 1913, and published in the Queensland Government Gazette of the 20th November, 1913. 283 Award of the Industrial Board for Shop Assistants in the South-Eastern Division made 21 February 1916 appearing in the Government Gazette of the sixteenth day of March, 1916. 284 Industrial Arbitration Act 1916, s 4. 285 Conciliation Act 1894 (SA). 286 Industrial Arbitration Act 1912 (SA). 287 Industrial Arbitration Act 1901 (NSW) s 2. 288 Industrial Disputes Act 1908 (NSW). 289 Industrial Disputes Act 1908 (NSW) s 27(2)(d). 290 (1907) Vol. 6 A.R. 139 (“Mark Foy”). 291 Mark Foy, 147. [2026] FWCFB 75 129 for a lad to grow old enough to have the combined maturity and experience to make a good shop assistant. However, in the case of an adult who already had the tact, knowledge of human nature, weight, developed intelligence and other qualities that came with age, much less experience was necessary. It was also necessary for the court to consider the proportions in which employees of different ages should be engaged. The President noted that the union claimants were asking for higher wages for their members, but feared that employers would respond by dismissing the highly-paid seniors, and wished to be guarded against this.292 After reviewing the returns of the city shops the President considered that around half the employees were under 23, and half were 23 or older, and drafted a proportion clause requiring that there was not to be, in any shop or establishment, more shop assistants employed who were under the age of 23 than of shop assistants who were of or over that age.293 The wages clause of the award then included a scale of male and female rates for shop assistants, running from age under 15 to age 24. There were four other scales, also with male and female rates, which applied to different workers depending on the age at which the worker commenced in the business without experience, from age 15, to age 18 (with male shop assistants who did not commence until age 18 not achieving the full rate until age 25). The award had an equivalent of an ‘old, slow or infirm’ clause which also extended to inexperienced workers generally, allowing them to be employed at less than the applicable minimum wage subject to certain conditions.294 [471] The Tasmanian parliament passed wages boards legislation in 1910295 and established wages boards for manufacturing and also some agricultural callings. The proceedings of wages boards were required to be kept secret.296 The wages boards could provide for overtime payments for employees aged over sixteen. It could make provisions for wage rates for apprentices (defined as being under 21 and indentured) and improvers (not defined); if wages were set to increase by reference to experience, the apprentice or improver’s whole experience in the trade, not just with the employer, had to be taken into account. [472] The Western Australian parliament passed compulsory conciliation and arbitration legislation in 1900.297 The Act as passed defined workers as being over the age of 18, with some exclusions including for apprentices aged over 18. Early awards provided for rates for apprentices. In the Tailors case of 1907298 the Court of Arbitration decided that in tailoring only qualified workers and apprentices could be employed, essentially preventing improvers of any age from being employed, and set rates for apprentices. The court’s jurisdiction to make an award regulating apprentices was challenged. Apprentices were added to the definition of industrial matters in 1909. [473] Across the early state legislation and early awards there were similar concerns, dealt with in different ways, including wage fixing, the proportions of apprentices or young workers to hands or senior workers, working hours and overtime, and other matters relating to child employment and safety in factories and manufacturing. Issues of youth wage rates and 292 Mark Foy, 151. 293 Mark Foy, 152. 294 Mark Foy, 162. 295 Wages Board Act 1910 (Tas). 296 Wages Board Act 1910 (Tas), s 8. 297 64 Vict No. 20. 298 Western Australian Industrial Gazette Vol 6 pp 97-110. [2026] FWCFB 75 130 proportions of young to old workers were closely related with a view to guarding higher-paid adult workers from dismissal and replacement with cheaper young workers. It will also be noted that age was of concern not only in relation to young workers but also in relation to “aged” or “old” workers, with special arrangements being made to allow them to work for less, lawfully. [474] More recently, with regard to retail awards, it is convenient here to note a convergence, albeit incomplete, as to percentage rates. The 1999 AIRC Junior Rates Inquiry report notes that the exit age of 23 in the New South Wales retail awards had been removed by at least 1960, and that in 1968 New South Wales awards were restructured to prescribe junior Shop Assistant pay rates as percentage rate scales (still differentiated as between male and female workers).299 The Full Bench went on to state:300 Thereafter, it appears that the percentage relativities were increasingly aligned, if not with federal Metal Trades Award precedents, at least with comparable wage levels under other State retail awards. Thus by the completion of the phasing in of equal pay and removal of female differential basic wage in 1974, the under 16 to age 20 percentage rates were ranged evenly in 10 per cent age progression increments from 40 per cent at age 16 to 90 per cent at age 20; much the same sort of pattern and timing as disclosed for the Metal Trades Award in Figure 2.1 [of the 1999 AIRC Junior Rates Inquiry report] above. Over the following two years that pattern was matched closely in the main retail awards in all States except Queensland. As may be seen from Table A1 of Appendix A, it has remained virtually unchanged since. (citations omitted) [475] However, the Full Bench went on to note301 that there had been significant changes in relation to the ‘comparator’ rate for junior rates. It said that after 1989 a series of minimum rate adjustment decisions changed classification structures from a growing array of Shop Assistant pay scales to a single broadbanded “true minimum rate” for what became Retail Worker Grade 1, fixed at a relativity of 92 per cent to the trades equivalent. It said the rate fixed by the Industrial Relations Commission of Victoria had included supplementary payments, and that all state tribunals had done, or later did, likewise, by consent. [476] The 1999 AIRC Junior Rates Inquiry report also referred302 to an Industrial Relations Commission of Victoria Full Bench that made findings based on employers’ evidence, including that “most employees in the retail industry are regarded by their employers as competent sales assistants within a relatively short period of employment,” and “the substantive criteria by which most retail employers judge their staff is sales performance rather than experience, length of service or product knowledge.” The Junior Rates Inquiry Full Bench referred also to a 1985 decision in which the NSW Industrial Commission rejected a claim for the insertion of a general “improver rates” for junior new starters. The Full Bench went on to say: 303 299 1999 AIRC Junior Rates Inquiry report, [2.2.31]. 300 1999 AIRC Junior Rates Inquiry report, [2.2.31]. 301 1999 AIRC Junior Rates Inquiry report, [2.2.32]. 302 1999 AIRC Junior Rates Inquiry report, [2.2.32]. 303 1999 AIRC Junior Rates Inquiry report, [2.3.32]. [2026] FWCFB 75 131 “We have noted some points of difference in the development of junior rate classifications in retail awards. Perhaps the most relevant to our task overall is the intermittent use of relatively short periods of “experience” as an offset or qualifying condition for discounting or exiting a discounted rate. That usage, and the observations we have quoted, imply views about degrees of effect of maturation deficits. However, the substantive principles applied to the content and development of retail junior rate classifications are not relevantly distinguishable from those we have described for the metals industry.” The Commonwealth [477] Turning now to the Commonwealth, we note that the 1999 AIRC Junior Rates Inquiry report, to which we were referred, provides304 an excellent history of industrial arbitration, including in relation to junior rates, which we have found helpful in these proceedings. [478] The Commonwealth did not establish wages boards but instead established the conciliation and arbitration system by passing the Conciliation and Arbitration Act 1904 (Cth). That Act’s definition of “industrial matters” included all matters pertaining to “the employment, preferential employment, dismissal, or non-employment of any particular persons, or of persons of any particular sex or age...”.305 Nonetheless the court drew from wages board decisions. This included rates for young workers. In the Harvester judgement, Justice Higgins set rates for various cohorts including unskilled labourers, journeymen, apprentices, and unapprenticed boys. He said,306 “I have taken my scale for apprentices (bound apprentices) from the determination of the Wages Board for Ironmoulders. The wages for boys not apprenticed I have taken from the Victorian Railways.” Having criticised the practice of employing people as “improvers” rather than journeymen, he sought to deal with this by also setting percentage rates for young journeymen by reference to a mixture of age and experience,307 though the source of those percentages was not made explicit. In that decision the court had regard to four states’ wages boards and observed that they had set lower minima than they otherwise might have, for fear of competition from other states. [479] Justice Higgins had expressed concern about the use of unapprenticed young workers in the Harvester judgement.308 In the Bootmakers’ case,309 Justice Higgins elaborated on those concerns in an industrial arbitration context and considered arguments about whether wages for apprenticed and unapprenticed boys should be fixed according to age or experience. Justice Higgins indicated he had heard evidence that fixing rates according to experience led to “anomalies, to unfair devices, to friction, to disputes.”310 He considered that fixing according to age was preferable, and that it was preferable for young workers to be apprentices than 304 1999 AIRC Junior Rates Inquiry report, Chapter 2, Part 2. 305 Conciliation and Arbitration Act 1904 (Cth) s 4. 306 Ex Parte H.V. McKay [1907] CthArbRp 12; (1907) 2 CAR 1 (“the Harvester judgement”), 16. 307 The Harvester judgement, 24-25. 308 The Harvester judgement, 16. 309 Australian Boot Trade Employés Federation v Whybrow and Co [1909] CthArbRp 10; (1909) 4 CAR 2 (“the Bootmakers’ case”). 310 The Bootmakers’ case, 38. [2026] FWCFB 75 132 unapprenticed “improvers.” In the latter regard the court was concerned that allowing boys to work for long periods unapprenticed would erode skills in the trade.311 The court decided that boys over the age of 16 or engaged for more than 12 months should be apprenticed, other than those engaged for certain menial tasks. This provision was subsequently varied twice, once to remove the twelve-month limitation and once to add a provision allowing for a one-month probation period prior to apprenticeship. The court fixed minimum rates for “lads whether apprenticed or not”, with a progressively increasing scale starting with those aged under 15, up to age 20. (The High Court subsequently overruled the age basis for boys’ wage rates.312 The court dealt with this by striking out the relevant clause, leaving apprentices’ wage rates for determination as between the employer and the boy and his father, and providing no discounted rates for unapprenticed boys.) The award made in consequence of the Bootmakers’ case also made provision for special, discounted wages for aged, slow, and infirm workers. [480] The SDA referred us to the Rural Workers’ Union313 (“the Fruit Pickers’ case”). It submitted314 the Court had “set wages for young workers by reference to notions of work value and the ‘needs’ principle, stating that while children aged 10 could perform the work, their lack of a steady application, feeling of responsibility, or the desire or need for pay (compared to the superior skills and responsibilities of a man of 30 or 40) justified lower rates for junior employees.” The SDA submitted that though the common law age of majority was, at that time, 21 years, the Court had accepted on work value grounds that 18 was an appropriate ‘exit age’ for young fruit pickers. [481] The various jurisdictions’ legislation and minimum wage-setting apparatus, and the awards made by the various institutions as they changed over time, developed separately from those origins. It would not be practical to canvass all of the differences here. It suffices to observe that the origins of minimum rates, and of having different minimum rates for young workers and/or unapprenticed improvers, were not uniform across the different jurisdictions, and the development of awards varied or made in the intervening decades between those origins and the creation of the current “modern awards” was also not uniform. This assists in understanding the diversity of junior rates provisions in the instruments under consideration in the retail industry when award modernisation commenced in 2008. As indicated above there were more than 100 instruments listed in respect of the retail industry, including in relation to fast food and pharmacy operations. We will not canvass them all here, but we observe that they had varying scales for junior rates, as well as varying arrangements in relation to allowances and penalties by reference to age. The rationales for aged-based rates, and relationships with adult and training rates, changed over time [482] The available records of the origins of these arrangements tell us very little about the specific basis on which any particular junior rate or improver rate was calculated, which is 311 The Bootmakers’ case, 15-16. 312 Australian Boot Trade Employés Federation v Whybrow and Co [1910] HCA 8; 10 CLR 266. 313 Rural Workers’ Union and South Australian United Labourers’ Union v The Employers, Parties to the Temporary Agreement referred to in the Order of the President, dated the 1st December, 1911- The Mildura Branch of the Australian Dried Fruits Association and Others (Fruit-pickers Case) (1912) 6 CAR 61. 314 SDA’s closing submissions, [52]. [2026] FWCFB 75 133 unsurprising given that the wages boards were comprised of employer and worker representatives and their awards were made by agreement (which is to say, compromise). [483] However, once courts became involved in wage fixing, the evolving rationales became a matter of record. The SDA submitted315 that at the heart of the Mark Foy decision was the tension between setting rates for shop assistants based on age or based upon experience. It said the majority concluded that neither age nor experience alone was a sufficient basis for setting wages. [484] More broadly we can see that over time, in different industries, there were different approaches, including in relation to whether rates for those entering the workforce for the first time should be set by reference to age, experience, or status as an indentured apprentice or as an “improver.” The 1999 AIRC Junior Rates Inquiry report gives an example, in relation to the Commercial Printing Award made in 1925, where the male junior classification used age progression whereas the female classification was based on years’ experience.316 [485] Prevailing wage-fixing ideas and approaches informed the way that rates were set.317 The SDA referred us to Australian Insurance Staffs Federation v Accident Underwriters Association318 as an example showing the prejudices inherent in the needs principle. In that case, Quick DP had said, in relation to wage rates in the ‘juvenile’ period of employment between ages 15 and 21:319 I agree with the arguments submitted on behalf of the companies that it is not desirable that boys should start with salaries too high for their situation in life and their required standard. It only tends to encourage inflated ideas of self-importance and creates a tendency to habits of extravagance. It is better for them to wait for better remuneration till they reach a mature age when they will deserve more and appreciate the value of money. In this respect the weighty evidence of Mr. P. Cleak may be cited with approval, viz.:— “I do not think it is a good plan to give a youth too big a salary, as that might mean that he has too much money to spend on amusements and holidays, but I think everyone will agree that the average man is all the better for a little bit of struggling and hardship. I. do not mean real hardship, but that he should meet with some adverse circumstances to enable him to form his character. In my own case, I did not have as much money to spend as the present-day youth, and my pleasures were more simple than his. I hold the opinion that if a youth has too much money to spend he is inclined to become slack. He seems to imagine that everything will fall into his lap without his having to worry very much, and that is no assistance in the formation of his character. It is difficult to say at what age 315 SDA’s closing submissions, [48]. 316 at [2.2.4]. 317 See 1999 AIRC Junior Rates Inquiry report, [2.2.5] and note 17, citing Re Printing Trades Award (1934) 33 CAR 581, 582-3. 318 (1924) 19 CAR 208. 319 Ibid, 221. [2026] FWCFB 75 134 a man’s character is formed, but, taking the average, I think it is 24 years of age that a boy begins to realize his responsibilities.” [486] The SDA also referred to the 1934 Printing Trades decision320 in which Dethridge CJ had said:321 Rates for juniors should be high enough to maintain them, but not high enough for extravagance; high enough to attract juniors to an industry, but not so high as to discourage employers from engaging them. The rates must have some relation to the probable cost of living, and therefore to the amount of the basic wage. Where the advanced junior gives his employer the benefit of skilled work, this may fairly in my opinion be regarded as generally offset by the fact that the skill, which is a lasting benefit to the junior, has been imparted to him by or through the employer. The question, then, in effect, resolves itself into what proportion the rates for juniors should bear to the basic wage for adults. High rates for juniors are frequently desired by unions in order to promote the employment of adults, but this object, quite justified within reasonable limits, may be achieved least injuriously by limiting the proportion of juniors. To unduly close the openings for junior labour by imposing excessive rates would be mischievous. The most advanced junior has not as a rule any family responsibilities, and his rate should be materially less than the basic wage. [487] In the 1999 AIRC Junior Rates Inquiry report, the Full Bench noted322 that 1934’s Printing Trades decision was made: “…at a time and in a context where rates for juniors were determined, put into, or omitted, from awards very much on an award by award basis. The relative absence of “general principle” did not then denote an entire lack of consistency of approach to the award by award issues that arose. The cases disclose that aspects of relative needs, the relationship of the classification to apprenticeship opportunities and rates, and the likelihood of “inexperienced” juniors being substituted for “experienced” men particularly, were prominent points of reference in the assessment of junior rates. Sensitivity to the benefits and flaws of using experience, or age, as conditions determining when the full primary wage should be paid was also part of the body of principle developed. Concepts such as needs, the desire to moderate competition between juniors and adults, and work value were each applied in particular decisions.” [488] As can be appreciated from the above history, initial statutory minima, which were set very low, were initially to be directed at preventing exploitation of vulnerable workers, particularly including young workers, in factories. Pre-Harvester, it seems the justification for setting different rates for young, old, infirm, or slow workers, or improvers, was essentially that they needed employment and their output was such that they would not get it unless they could accept a discounted rate (so, a mix of work value and employment bases). The 1999 AIRC 320 Printing and Allied Trades Employers Federation of Australia v The Printing Industry Employees Union of Australia (1934) 33 CAR 581 (“the Printing Trades decision”). 321 The Printing Trades decision, 583. 322 At [2.2.5]. [2026] FWCFB 75 135 Junior Rates Inquiry report had summarised the subsequent justifications for using the personal attribute of age for setting age-based rates as follows:323 2.1.10 … age is the attribute on which wage progression in junior rates is based for the persons, or sometimes the work, covered by the classification. It is an objectively ascertainable but “individual attribute”. Junior rates use the attribute in a way that causes it to be in form a “personal” classification. There have been several rationalisations of that usage. Awards providing wage rates for juniors originally used age, or age and years of experience, as the proxy indicators of the degree of discount appropriately made from the needs based primary wage for adults. Age was later treated in Australian practice as an alternative to years of experience when fixing the entry level pay rates and progression for post-compulsory school age workers. That usage conceptually linked age or the experience test with a discount from the needs based wage. That linkage was tied to a recognition that the employee gained through the training and experience that the employer provided. That recognition was a basis on which arbitrators also linked, and not infrequently equated, junior rate classifications with the same use of age or years of experience for apprenticeship rates of pay. More recently, but in economic rather than in arbitral usage, age has been conceived to be an acceptable proxy for an initial deficit and progressive increase in "human capital". That concept covers work related skills and attributes developing with age and general life experience (maturation). Conversely, the age progression in junior rates is an approximation to a generalised rate of development of such “maturation skills” in the absence of any more specific measure suitable for application in minimum rate awards. It is not a proxy for specific job-oriented competencies.” (emphasis in original) [489] The SDA referred us to the move, in the 1937 Printers Case,324 from wage scales to a wage setting system for junior rates based on a flat percentage of the basic wage. It also referred us to the 1937 Metal Trades Award decision in which Beeby J had refused an application to remove experience as an underpinning for junior rates.325 Beeby J said:326 “Unions of employees, parties to the Metal Trades award again apply to the Court for … the substitution of scales of wages based on age instead of experience for juniors engaged in manufacturing. Similar applications have previously been refused after full inquiry into allegations that the experience scale had led to the unjust exploitation of junior labour. … In hearing this renewed application I was prepared to make the variation asked for if the evidence supported the allegation that the experience clause had been used by employers as a device for securing the services of juniors of mature years at inadequate wages. The experience scale was deliberately adopted for the purpose of giving youths opportunities of entering occupations which would not have offered if the age scale without any relation to experience had been adopted.” 323 At [2.1.10]. 324 Printing and Allied Trades Employers Federation of Australia v The Printing Industry Employees Union of Australia and C Acton; The Printing Industry Employees Union of Australia v The Printing and Allied Trades Employers Federation of Australia (1937) 38 CAR 279, 280 (“the 1937 Printers Case”). 325 Metal Trades Award (1937) 38 CAR 328. 326 Ibid, 341. [2026] FWCFB 75 136 [490] Shortly afterwards, by consent, a percentage system as the mechanism for setting (male) junior rates was included in the Metal Trades Award, with male juniors 16 and under to be paid 40% of the current adult male needs basic wage, with percentages rising by age up to 75% to age 20.327 From 1941, after a consolidation, both male and female junior rates were expressed as age-based classification rates stipulated as percentages of the basic wage in the Metal Trades Award.328 [491] Significantly the Court and then the Commission moved away from the Harvester concept of needs as the basis for wage fixing. From early days of arbitration, the needs concept had been moderated by issues related to employers’ capacity to pay and then by broader economic considerations. In 1953, the Court considered earlier decisions of the 1930s in which capacity to pay, and the capacity of the economy as a whole to sustain the level of wages. They pointed out that in 1937 the Court had said that the basic wage was no longer related to the Harvester wage. They said that at that point the total basic wage bore no relationship to the Harvester standard either in concept or fact. After then canvassing wartime and later cases, the Court said no-one had submitted that it “should scrutinize the present basic wage specifically from the point of view of the reasonably necessary expenditure of an average or a typical unskilled working man, whether with or without family responsibilities.”329 The Court considered it “well established principle” that the basic wage should be set by reference to “the highest that the capacity of the community as a whole can sustain.”330 [492] The Commission adopted the ‘total wage’ concept in the 1967 National Wage Cases decision.331 This did not involve starting over; the new total wages reflected previous basic wages and margins as developed over time according to different wage-fixing approaches, and as adjusted by the National Wage Cases. This meant that earlier considerations of need, among other things, continued to affect the minima set by the Commission at that time, by operation of path dependency, even though need was no longer a basis for wage fixing. Work value in the 1960s and 1970s [493] In 1967, the Work Value Inquiry decision,332 for the metals industry, included an observation from Commissioner Winter that he had seen juniors doing semi-skilled work during that inquiry, which suggested increases to other classifications should be flowed on to apprentices and juniors “in proper proportion,” but at that point junior rates were attached to the classification “Employee not elsewhere classified,”333 and rates for that classification were not increased in the Work Value Inquiry. The attachment to this classification had been the product of an agreement between the parties several years earlier. In subsequent proceedings in 327 (1937) 38 CAR 540, 541. There was also a loading, in absolute not percentage terms, for each age, and a separate payscale for apprentices, with both the adjustable and loading portions in absolute not percentage terms. 328 Re Metal Trades Award (1941) 45 CAR 751. 329 Basic Wage and Standard Hours Inquiry 1952-1953 [1953] CthArbRp 473; Print A3282; (1953) 77 CAR 477, 495. 330 Ibid, and see also 497, 507. 331 National Wage Case 1967 (The Metal Trades Award 1952) (1967) 118 CAR 655 (“the 1967 National Wage Cases decision”), 660. 332 Metal Trades Award 1952; Metal Trades Employers Association & Ors v The Amalgamated Engineering Union (Australian Section) & Ors [1967] CthArbRp 1144; (1967) 121 CAR 587 (“the Work Value Inquiry”). 333 Ibid, 800. [2026] FWCFB 75 137 1969, Commissioner Winter said he did not consider it fair or appropriate for junior rates to be tied to the classification concerned, and decided instead to tie them to a different classification, that of Process Worker. He also considered an unreasonable anomaly existed with respect to the differentiation in the scales as between males and females. Commissioner Winter decided to delete the rates for Unapprenticed males under 16 and aged 16, and instead have a single rate for Unapprenticed males aged 17 and under, granting the percentages that had been claimed, which differed between the unapprenticed male and female categories (both in the percentages for each age, and in whether they were in reference to the rate for adult males or adult females). Commissioner Winter subsequently revised his decision to include transitional arrangements. The reasons do not reveal any detailed work value analysis for setting the specific percentages.334 In deciding the appeal,335 the Full Bench noted the junior rates had been fixed, by agreement, at prescribed relationships with the wage for a particular classification in 1965. They accepted Commissioner Winter’s change to the different comparator classification of Process Worker. They then adjusted the junior rates scales, again without reference to specific work value bases for the percentages. Instead their reasons went to the size of the increase provided to adult process workers, the increases for other adults arising from the Work Value Inquiry, junior rates in other industries, and their view that the rates they had chosen were “appropriate” and “reasonable.”336 As the Full Bench points out in the 1999 AIRC Junior Rates Inquiry report, the rates were then brought into a single gender neutral classification; a junior rates scale was set by a consent award in 1973.337 [494] In the April 1985 National Wage Case decision, the Full Bench considered junior rates in detail and referred to this history as follows:338 “This is the first occasion on which the Commission has been asked to review junior rates because of unemployment of young persons. The question of junior rates and their relationship to adult rates has for a long time mainly been determined by the consent of parties. In the early 1970s a compression in junior/adult relativities occurred following an agreement for an increase in junior wage rates in the Metal Industry Award in 1972. The new standard set in that award spread generally.” [495] In the federal retail awards of the time, junior rates percentages appear to have been fixed by reference to matters other than work value: • In a 1964 decision on the Retail and Wholesale Shop Employees (Australian Capital Territory) Award,339 the Commission took into account labour supply issues in the territory, noting that it was difficult to compete for labour given the attractiveness of working within the Commonwealth Public Service, low adult wages and associated junior rates, and various conditions (including the five and a half day week, Friday 334 Re Appeal against Award: Metal Trades (1969) 127 CAR 664, 685-689. 335 Re Appeal against Award: Metal Trades (1969) 127 CAR 700. 336 Ibid, 703-704. 337 At [2.2.21]. 338 National Wage Case April 1985 [1985] AIRC 84; [1985] CthArbRp 135; (1985) 297 CAR 7; Print F8100 (“April 1985 National Wage Case”), 17. 339 Shop Assistants and Warehouse Employees Federation of Australia v J B Young and Co Ltd & Ors; David Jones (Canberra) Pty Ltd & Ors v The Shop Assistants and Warehouse Employees Federation of Australia [1964] CthArbRp 752; (1964) 108 CAR 136, 138-139. [2026] FWCFB 75 138 night trading, and discounted wages for the first 12 months for 17-year-old female employees). • In 1976, the Retail and Distributive Employees (NT) Award was varied by consent to include a new table of percentage-based, gender-neutral junior rates.340 In 1982,341 the Commission said the junior rates in that award were generally regarded as a Northern Territory standard. [496] The foregoing history tells us that in the case of the metal trades and in the federal retail awards junior rates percentages had been set by a combination of consent, comparisons with other awards or prevailing standards, general views from the bench as to “appropriateness” and “reasonableness,” or as a consequence of equal pay changes. What is missing is any indication that the percentages chosen were based in some considered analysis that the work of an 18- year-old was generally worth a particular proportion of the value of the work of a 21-year-old. Work value appears to have been more relevant to deciding which classifications would attract junior rates. In addition to the 1969 Metal Industry decisions referred to above, a later example appears in 1982 in which work value considerations were used as a basis to refuse to apply junior rates to the occupation of ‘cashier’ in the Theatrical Employees Award.342 The Commission said, “the nature of the work, the conditions under which it will be performed and the overall responsibilities of the position are such that for the present I propose to include it with “person in charge” and “patrolman” as classifications in which persons under the age of 20 will not be employed.”343 [497] The SDA’s submissions referred to the emergence of the fast food industry, and the beginning of its industrial regulation, at around this time. The SDA submitted that the mid- 1970s saw the emergence of the fast food industry, and that the decision of Macken J in Re Shop Employees (State) Award (No 2)344 was one of the earliest decisions recognising its emergence. It submitted that relevant, the history of junior rates for work in the fast food industry could be traced back to that period, when the industry had initially come under the fold of the general retail awards. It submitted that when the awards were split during the award modernisation process junior rates were an entrenched practice in the fast food industry, but with the same origins as those in general retail.345 Further movement away from ‘need’, and the focus on equal pay cases [498] In the 1974 National Wage Case decision, the Commission confirmed the total wage did not have any component for family obligations, repeating an observation that the 340 Retail and Distributive Employees (Northern Territory) Award 1974 [1976] CthArbRp 21; (1976) 174 CAR 110; Print C6242. 341 Re Retail, Wholesale and Distributive Employees (N.T.) Award 1980 [1982] CthArbRp 962; (1982) 273 CAR 613, 615. 342 Australian Theatrical and Amusement Employees Association and Hayden Pty Ltd & Ors [1982] CthArbRp 990; (1982) 273 CAR 724; Print E9570. 343 Ibid, 726. 344 [1977] A.R 555. 345 SDA’s closing submissions, [74]. [2026] FWCFB 75 139 Commission was an industrial arbitration tribunal, not a social welfare agency, and stating the care of family needs was principally a task for governments.346 [499] Soon after the abolition of the basic wage, the Commission had dealt with cases relating to the removal of differential rates for women.347 In 1969, it decided that men and women doing the same work should be paid the same. In 1972, the Commission decided to set rates on the basis of work value without regard for sex. It decided the principle of ‘equal pay for work of equal value’ would apply to all awards. As an Expert Panel observed, the principle established by the 1972 Equal Pay Case was only ever implemented in part.348 The work of addressing what is now known as gender undervaluation continues to this day. [500] The SDA pointed out that the only tribunal to directly address the concept of equal pay for work of equal value in relation to juniors was the Storemen, Packers and Sorters Board, a Victorian wages board. In 1973, that Board had determined new wages for junior employees based on work value. This had been overturned on appeal. [501] The SDA submitted that many of the assumptions underlying junior rates were the same as those concerning female rates that were explicitly or implicitly rejected with the introduction of equal pay for work of equal value. Nonetheless, it submitted, the equal pay decisions were not a watershed moment for junior rates. We agree the focus in the 1969 and 1972 equal pay cases had been on discrimination against female workers, rather than discrimination on the basis of attributes other than sex or gender. These cases had been brought on that basis. [502] Australian jurisdictions revised the age of majority to age 18, between 1971 and 1977. The 1999 AIRC Junior Rates Inquiry report noted that though there did not appear to have been any associated alteration of the industrial concept of “juniors,” a number of awards were altered from around that time to allow for the “adult rate” to be paid to employees on attaining age 18.349 But the age of majority change did not lead to uniform change across all awards that had junior rates at the time. [503] By the mid-1980s, the focus had shifted to the employment effects of junior rates.350 We now turn to some of the significant consideration of junior rates by this Commission or its predecessors, and by others, since that time. Before doing so, we note that, as was observed in the 1999 AIRC Junior Rates Inquiry report, consideration of junior rates has often been undertaken alongside consideration of rates for those undertaking apprenticeships (and, more recently, traineeships). Though there is overlap, not all juniors are in formal training and not everyone in formal training is a junior. There is also a distinct concept of a worker being an “improver,” discussed below. For present purposes we note that the issue of pay rates for persons engaged in training for what are now AQF qualifications has also been given extensive consideration in arbitral and other contexts. 346 1974 National Wage Case decision, 299. 347 The 1967 National Wage Cases decision; National Wage and Equal Pay Cases 1972 (1972) 147 CAR 172; and the 1974 National Wage Case decision. 348 Gender-based undervaluation decision, [43]. 349 1999 AIRC Junior Rates Inquiry report, [2.5.1]. 350 See for example On-Airport Retail Concessions Award 1985; Airport Tourist Services Stores Award 1982; Airport Tourist Services Stores (Taralba) Roping-In Award 1983 [1986] CthArbRp 727; (1986) 303 CAR 741; Print G6038. [2026] FWCFB 75 140 Accord-era consideration [504] Junior rates were the subject of detailed consideration in the April 1985 National Wage Case decision, because the CAI had sought that the national wage increase be confined to adult rates and not applied to junior rates. The main ground advanced for that claim had been the disproportionately high rate of unemployment among 15- to 19-year-olds of about 23%. The Full Bench stated:351 “This is the first occasion on which the Commission has been asked to review junior rates because of unemployment of young persons. The question of junior rates and their relationship to adult rates has for a long time mainly been determined by the consent of parties. In the early 1970s a compression in junior/adult relativities occurred following an agreement for an increase in junior wage rates in the Metal Industry Award in 1972. The new standard set in that award spread generally.” [505] They considered the submissions and evidence from unions, employer organisations, and governments, and went on to state:352 “We have reported on the material before us in some detail because of the great concern we share with the parties and interveners on the question of youth unemployment. However, the wide range of junior rates and the differing provisions for juniors in awards suggest that an award by award consideration, rather than a broad-brush uniform action, may be a more appropriate course. Furthermore, the indeterminate nature of the statistical evidence in favour of the course proposed by CAI, and the fact that [the Report of the Committee of Inquiry into Labour Market Programs, known as] the Kirby Report recommendations are currently in train, including the consultations referred to above, have led us to the conclusion that it would be unwise, on the submissions before us, to accede to the CAI's application.” [506] The Commission took the same view in the June 1986 National Wage Case.353 Later, in the April 1991 National Wage Case,354 the Commission said in regard to youth wages:355 “The ACTU and the Commonwealth and State governments advocated the cessation of the prescription of wage rates by reference to age. Instead, rates should be related to competency and skill. The Commonwealth government proposed that there be a separate Full Bench to consider this reform and issues related to it. In addition, the ACTU asked us to consider what it saw as an “immediate problem” in the manner whereby junior rates are now specified. This problem concerns alleged inconsistencies between awards, and even within them, in the identification of the adult rates to which junior rates are related. The CAI contended that it would be inappropriate for this Bench to determine these issues. Youth wages should be dealt with at another time, when they could be more fully debated.” 351 April 1985 National Wage Case, 17. 352 April 1985 National Wage Case, 20. 353 National Wage Case June 1986 [1986] CthArbRp 337; (1986) 301 CAR 611; Print G3600, 52. 354 National Wage Case April 1991 [1991] CthArbRp 324; (1991) 4 CAR 204; Print J7400. 355 Ibid, 57. [2026] FWCFB 75 141 [507] The views attributed to the ACTU differed from an approach taken in fast food in Western Australia shortly before. The Ai Group’s lay witness Mr Morton annexed to his statement a transcript of a 1990 Western Australian Industrial Relations Commission hearing into a new consent award for fast food outlets in Western Australia. In that case Mr Bullock, on behalf of the Federated Liquor and Allied Industries Employees Union of Australia, Western Australian Branch, Union of Workers, had said that the union had sought to introduce junior rates for people aged 18 and 19, who had until then been paid adult rates, to remove the disincentive to employ more senior juniors, and to remove the concentration on 15- to 17-year- olds which had existed in the respondents’ employment structure.356 IR Reform and Workplace Relations Reform era [508] The Industrial Relations Reform Act 1993 (Cth) amended the then Industrial Relations Act 1988 (Cth) to include a new section 150A, providing for a triennial review of awards in which the Commission was to, inter alia, remove age discrimination. The August 1994 Review of Wage Fixing Principles357 again declined to deal with junior rates in that general decision. They noted that the Commonwealth had submitted there was inconsistent treatment of junior rates in awards of the Commission while ACCI had said youth wages would be more appropriately addressed in separate proceedings. The Full Bench considered junior rates to be an issue of “considerable social, economic and industrial importance.” They referred to junior rates being considered by a different Full Bench constituted to deal with some of these issues in the furnishing industry, and said the decision in that case may assist in resolving some of the issues concerning junior rates raised before them.358 [509] The different Full Bench had been constituted to deal with an application in relation to junior rates in the Furnishing Trades Award. The Full Bench produced issues papers directed to both the parties to that application and the parties to the Review of Wage Fixing Principles. Its final issues paper raised a range of broader issues relating to youth and apprentice wages which potentially arose out of the application. The parties agreed to a two-stage process; stage 1 was to determine the immediate application, and stage 2 involved establishing a working party to address and try to seek agreement in relation to the wider issues.359 [510] The Furnishing Trades Case 1994360 dealt with stage 1. In that decision, the Full Bench determined that aged-based junior rates and apprenticeship rates would be applied to adult minimum rates inclusive of supplementary payments and safety net increases. However, it decided it insufficient evidence before it to determine application for removal of age based junior rates, and that this matter would be better considered as part of the review of “youth/training wages” in stage 2. 356 Exhibit 88, Statement of Mr Morton, Annexure SM-3, Transcript, 51-53. 357 Review of Wage Fixing Principles [1994] AIRC 1249; Print L4700, 32. 358 Pursuant to then section 150A of the Industrial Relations Act 1988 (Cth), which provided for award reviews. 359 See the history set out in Re Furnishing Trades Award [1996] AIRC 379; Print N1418. 360 Re Furnishing Trades Award [1994] AIRC 1724; Print L5963. A further, consequent increase was granted in Re Furnishing Trades Award [1996] AIRC 379; Print N1418. [2026] FWCFB 75 142 [511] For stage 2, the working party process was established, and through it the parties sought that the Commission determine whether agreed reforms, including the use of trainee classifications below the base level in awards, met the age discrimination requirements in the amended Industrial Relations Act 1988.361 This was considered in a further decision362 which preceded the making of the National Training Wage Award. The working party suspended its work in advance of the 1996 federal election.363 [512] A permanent exemption of junior rates from the anti-discrimination provisions was proposed but not enacted in 1996. Instead, the Workplace Relations and Other Legislation Amendment Act 1996 (Cth) inserted into the renamed Workplace Relations Act 1996 (Cth) a new section 120B, requiring that a Full Bench of the AIRC prepare a report for the Minister on the feasibility of replacing junior rates with non-discriminatory alternatives. This led to the AIRC’s Junior Rates Inquiry, which reported in June 1999. In the intervening period the April 1997 and April 1998 Safety Net Review decisions364 made proportionate adjustments to junior rates, with junior rates forming part of the safety net. [513] We now turn to the 1999 AIRC Junior Rates Inquiry report. As can be appreciated from the above, the referral for the inquiry was premised on junior rates being discriminatory. As well as implying that junior rates were discriminatory, this formulation of the referral implicitly assumed that if the relevant awards did not contain junior rates based on age, there would be some alternative. In the report, the Full Bench considered, extensively, reasons in support of and against including age-based junior rates in awards. They considered there was a near- consensus, and it was their own assessment, that a discounted pay rate for entry level work continued to be necessary in the areas in which employment under junior rate classifications was most concentrated. They referred to the task, in that regard, as getting right the balance between classification options and two objectives:365 “• equal opportunity taking account of the competitive disadvantage in employment of school-leavers, teenagers and young employees; • equality of treatment in employment for all employees taking account of skills, responsibilities, experience and performance.” [514] The “classification options” referred to included variables such as the work description and/or class of junior employees covered, the comparator adult classification, if any, the exit age, and others. The Full Bench also considered the effect of junior rates on youth employment, and the utility of junior rates. [515] In summary the Full Bench found none of the identified non-discriminatory alternatives they had most closely examined were feasible in the circumstances. The conditions of feasibility for a given alternative, in the Full Bench’s view, were that it:366 361 including then s 150A of the Industrial Relations Act 1988 (Cth). 362 Print M7824, 4-6. 363 1999 AIRC Junior Rates Inquiry report, [2.2.44]. 364 Safety Net Review – Wages April 1997 (AIRC, P1997, 22 April 1997) and Safety Net Review – Wages April 1998 (AIRC, 29 April 1998, Print Q1998) 365 1999 AIRC Junior Rates Inquiry report, Summary, [7(iv)]. 366 1999 AIRC Junior Rates Inquiry report, [7.2]. [2026] FWCFB 75 143 • was a non-discriminatory alternative to the classification to be replaced; • was simple to administer; • did not remove a significant differential cost effect of an existing level of a discounted pay rate in the subject classification to be replaced, unless any such removal demonstrably would not disadvantage the competitive position of the classes of junior employees then in receipt, or likely to be in receipt of junior rates, or to be in receipt of the substituted rates under the classifications on entry level work; or otherwise does not have significant detrimental effect on youth employment under the subject classification; and • was reasonably capable of being implemented as an award classification by or soon after 22 June 2000 (slightly more than a year after the date of the report, 4 June 1999), taking account of the process prescribed by the legislation. [516] Assessed against this rubric, none of the options that had been put forward were feasible, for varying reasons. Further, the Full Bench considered that in the design of replacement of junior rate classifications no one size fits all. They found the fit of an alternative is a matter of attention-to-detail and the merits in particular circumstances. They discussed the context in which the report had been commissioned, including “a public debate about whether to resolve the conflict between the continued use of junior rates and the maintenance of anti- discrimination protective legislation,” and “the national and international preoccupation with perceived failures to bring about a labour market for youth employment that ensures an effective school-to-work transition and avoids long term youth unemployment.”367 [517] The Full Bench considered that, during award reviews for compliance with the anti- discrimination requirements of the legislation as then in force, “it would seem appropriate that any such review of a particular junior rate classification should take into account: • the avoidance of discrimination on grounds of age that has the effect of nullifying or impairing equality of opportunity or treatment in employment or occupation; • maturation skills and related personal attributes in the employment or in performance of particular work required under the classification; • the need for protective measures for young workers in the industry or employment covered by an award classification; • the desirability of maintaining a junior rate having regard to the availability and use of structured training under New Apprenticeships in the relevant industry, award or agreement; and • the likely effect of the junior rate classification in securing a reasonable balance of entry of young employees to employment in the relevant industry.”368 367 1999 AIRC Junior Rates Inquiry report, Summary, [4]. 368 1999 AIRC Junior Rates Inquiry report, [7.14]. [2026] FWCFB 75 144 [518] The three awards the subject of these proceedings have junior rates, but those rates are not uniform across the three. Junior rates are not a universal feature of awards. By the time of the 1999 AIRC Junior Rates Inquiry report, 20 of the 111 awards containing junior rates required adult rates to be paid from age 18 (or below), 25 from age 19 or below, and 47 from age 20 or below (these figures are cumulative).369 At the time, the Commission’s staff had identified seventy awards with no junior rates provisions.370 The Full Bench considered the use of junior rates to be much less significant in industries that do not require low-skill entry-level employees.371 [519] Subsequent to the 1999 AIRC Junior Rates Inquiry report, a permanent exemption was introduced by the passage of the Workplace Relations Legislation Amendment (Youth Employment) Act 1999 (Cth), which also reinforced that the then Australian Industrial Relations Commission was to take a case-by-case approach to determine whether junior rates of pay should be appropriately included in an award. The exemption has persisted to the present day. [520] In May 2000, the then Human Rights and Equal Opportunity Commission reported on its own inquiry in relation to age discrimination.372 Youth wages was a substantial issue in that HREOC process, and HREOC formed the view that there should not be a permanent exemption for youth wages, but instead temporary measures should be allowed subject to ongoing review.373 Despite this, the parliament subsequently passed the Age Discrimination Act which contained a permanent exemption for youth wages. Work Choices era [521] The Australian Fair Pay Commission, in its 2006 Wage Setting decision,374 announced it would initiate a review of junior wage arrangements in early 2007. However, this review was discontinued in December 2007 on the basis that it would overlap with and duplicate the award modernisation process.375 Forward with Fairness and Fair Work Act era [522] As we have averted to below in this decision, junior rates were considered briefly during award modernisation commencing in 2008,376 but a detailed consideration was not possible given the short amount of time and the size of the task of making modern awards in time for commencement to coincide with the National Employment Standards. Junior rates were also able to be considered during modern award reviews. The Annual Wage Reviews also require consideration of junior rates for modern award wage rates generally, as well as for the National Minimum Wage. We have discussed recent decisions in relation to the junior rates in the General Retail Industry Award and the Pharmacy Industry Award in this decision. 369 1999 AIRC Junior Rates Inquiry report, [2.2.19]-[2.2.20], [2.5.1]-[2.5.3], and Figure 2.4. 370 1999 AIRC Junior Rates Inquiry report, [2.7.1] 371 1999 AIRC Junior Rates Inquiry report, [2.7.2]. 372 HREOC, 2000., Age Matters: a report on age discrimination. 373 Ibid, 115. 374 AFPC, Wage-Setting Decision and Reasons for Decision October 2006, 13. 375 Australian Fair Pay Commission Media Release, 18 December. 376 Award Modernisation - Decision - Full Bench [2008] AIRCFB 1000 (“the Award Modernisation decision”). [2026] FWCFB 75 145 [523] Some of the various workplace relations and anti-discrimination bills have been attended by Senate inquiries in which the issue of junior rates was considered.377 Junior rates had also been considered in the Productivity Commission Workplace Relations Final Report 2015.378 As some of the parties took us to that report, we consider it useful to note that the Productivity Commission received submissions about the basis on which discounted rates should be offered and as to alternative models based on experience or competency. They had explicitly canvassed the idea of hybrid models entailing elements of both age and experience.379 But they were explicit that they had not formed a view on the appropriate structure, given the many possible models, the varying impacts on employers and employees, and the limited time and information that had been available to the Productivity Commission for that inquiry.380 Conclusions as to the origins and history [524] We find that junior rates have been a feature of minimum wages since before the establishment of the Commonwealth system of conciliation and arbitration. We find that after the Harvester judgement, considerations of needs influenced junior rates. We find that rationales for junior rates, including for specific percentages, were not always made explicit. We find that at least since the 1980s, addressing youth unemployment has been proffered as a substantial rationale for (sub-minimum) junior rates. [525] Having considered those historical matters, we now turn to considering the current application. As we have indicated above, section 157(2) confers a discretion to make a determination varying modern award minimum wages which is enlivened if the Commission is satisfied that the variation of modern award minimum wages is justified by work value reasons, and that making the determination outside the system of annual wage reviews is necessary to achieve the modern awards objective. As the Commission is varying modern award minimum wages, the minimum wages objective also applies. Further, in exercising its powers under Part 2-3 to set, vary or revoke modern award minimum wages, the Commission must take into account the rate of the national minimum wage as currently set in a national minimum wage order: s 135(2). The Commission must also take the objects of the Fair Work Act into account.381 Before considering work value and the modern awards and minimum wages objectives, we consider it useful to first deal with the issue of whether we can assume the three modern awards reflected work value and/or met the modern awards objective when they were made. Whether we can assume the three modern awards reflected work value and/or met the modern awards objective when made [526] We have considered the submissions made about the desirability of consistency with previous decisions. We must decide this application in accordance with the current statutory 377 See for example Senate Economic References Committee, Consideration of the Workplace Relations and Other Legislation Amendment Bill 1996; and the Senate Legal and Constitutional Legislation Committee inquiry into the Age Discrimination Bill 2003. 378 Productivity Commission Workplace Relations Framework Final Report, 251-262. 379 Productivity Commission Workplace Relations Framework Final Report, 259. 380 Productivity Commission Workplace Relations Framework Final Report, 262. 381 Fair Work Act s 578(a). [2026] FWCFB 75 146 scheme. In relation to these awards, and in these proceedings, we do not consider that we can assume that the three modern awards as made were determined by reference to any substantial assessment of work value, and nor can we assume that the awards, when made, met the modern awards objective. [527] To avoid doubt we have not set out the consideration, below, as a means of undertaking an assessment of the kind that the Fair Work Act requires in relation to gender, as to whether assumptions about gender had affected previous work value assessments. We have done so instead as part of our consideration of the parties’ submissions as to matters such as: • the desirability of stability and consistency with previous decisions; • what we should take from the 2014 Full Bench’s acceptance of the continued relevance of the rationale for junior rates;382 and • the necessity of the proposed variations, including whether variations are necessary to meet the modern awards objective and the minimum wages objective. Relevance of work value assessment in setting junior rates over time [528] We have below referred to the Aged Care Stage 3 decision383 in which the Full Bench said, in reference to subsection 157(2A), while also considering subsection (2B), that it is implicit in the statutory scheme that where adjustment to award rates is considered to be justified for work value reasons, the existing rates do not properly reflect work value.384 We are not here considering whether past assumptions about age led to undervaluation but it is relevant to consider whether we can assume that the current rates are the product of work value assessment and properly reflect work value. [529] It is relevant to note that the history of junior rates we have set out above does not reveal any detailed calculation of the relative work value of young workers compared with older workers. Pre-arbitral junior rates were based on protecting young workers from exploitation and did not involve modern conceptions of assessing work value. Early arbitration occurred in the context of the Harvester concept of need. Junior rates were often set by consent rather than after a consideration as to work value. As we will discuss in the next section, the modern awards under consideration in this case were derived from a range of instruments, including many state instruments that had themselves developed over time. The making of the three modern awards, 2008 – 2010 [530] As indicated above, the initial iteration of each of the three modern awards was made in the course of the award modernisation process385 conducted under the Workplace Relations Act following the Forward with Fairness amendments.386 The objects of the award modernisation 382 General Retail Junior Rates (20-year-olds) decision, [103]. 383 Aged Care Award 2010; Nurses Award 2020; Social, Community, Home Care and Disability Services Industry Award 2010 [2024] FWCFB 150, 331 IR 137 (“Aged Care Stage 3 decision”). 384 Ibid, [15]. 385 See Request from the Minister for Employment and Workplace Relations - 28 March 2006 - Full Bench [2008] AIRCFB 550; Award Modernisation [2008] AIRCFB 717; and the Award Modernisation decision cited above (Award Modernisation [2008] AIRCFB 1000). 386 made by the Workplace Relations Amendment (Transition to Forward with Fairness) Act 2008 (Cth). [2026] FWCFB 75 147 part of the Workplace Relations Act at the time, Part 10A, were set out in section 576A which provided: 576A Object of Part (1) The object of this Part is to provide for the Commission to make modern awards in accordance with an award modernisation request. (2) Modern awards: (a) must be simple to understand and easy to apply, and must reduce the regulatory burden on business; and (b) together with any legislated employment standards, must provide a fair minimum safety net of enforceable terms and conditions of employment for employees; and (c) must be economically sustainable, and promote flexible modern work practices and the efficient and productive performance of work; and (d) must be in a form that is appropriate for a fair and productive workplace relations system that promotes collective enterprise bargaining but does not provide for statutory individual employment agreements; and (e) must result in a certain, stable and sustainable modern award system for Australia. [531] The Commission’s function in relation to award modernisation was set out in section 576B which relevantly provided: 576B Commission’s award modernisation function (1) It is a function of the Commission to carry out one or more award modernisation processes. (2) In performing its functions under this Part, the Commission must have regard to the following factors: (a) promoting the creation of jobs, high levels of productivity, low inflation, high levels of employment and labour force participation, national and international competitiveness, the development of skills and a fair labour market; (b) protecting the position in the labour market of young people, employees with a disability and employees to whom training arrangements apply; (c) the needs of the low‑paid; (d) the desirability of reducing the number of awards operating in the workplace relations system; (e) the need to help prevent and eliminate discrimination on the grounds of race, colour, sex, sexual preference, age, physical or mental disability, marital status, family responsibilities, pregnancy, religion, political opinion, national extraction or social origin, and to promote the principle of equal remuneration for work of equal value; (f) the need to assist employees to balance their work and family responsibilities effectively, and to improve retention and participation of employees in the workforce; (g) the safety, health and welfare of employees; (h) relevant rates of pay in Australian Pay and Classification Scales and transitional awards; (i) minimum wage decisions of the Australian Fair Pay Commission; [2026] FWCFB 75 148 (j) the representation rights, under this Act or the Registration and Accountability of Organisations Schedule, of organisations and transitionally registered associations. … [532] It can be readily appreciated that these objections and functions provisions are similar but not identical to the considerations in the modern awards objective and minimum wages objective as presently in force. The AIRC had a short period of time to undertake award modernisation. The process commenced by ministerial request made under then section 576C of the Fair Work Act, in 2008, and the AIRC was asked to have modern awards in place in time for the commencement of the National Employment Standards in 2010. [533] To make the modern awards the Commission had regard to the federal and state industrial instruments then in force. When commencing the award modernisation process, the Full Bench published a list of instruments relevant to the “retail industry” that ran to eight pages,387 and included more than 100 instruments. The list included pre-reform federal awards and enterprise awards, and state awards.388 It included wholesale and retail trade awards, fast food industry awards, and pharmacy awards, among others. The provisions of those instruments were not uniform in relation to wage rates, including junior rates. [534] As to why separate modern awards were made for fast food and pharmacies (and hair and beauty, not presently under consideration) despite the legislative provisions favouring award rationalisation (reducing the number of awards overall, and minimising the number of awards applying to a particular workplace or employee), the Commission acceded to employer preferences for separate instruments, and decided it would be impractical to implement award rationalisation on the scale that had previously been provided for in the exposure drafts. Fast food and pharmacies had been included in the exposure draft for the main retail award, but the Full Bench decided that in some industries – including, principally, the retail industry – it would be impractical to implement award rationalisation on the scale provided for in the exposure drafts.389 They said:390 “The issue of the scope of the retail award raises important considerations concerning the objectives of award modernisation. The objective of reducing the number of awards applying in an industry carries with it the objective of rationalising disparate terms and conditions so that the resultant safety net is more uniform, consistent and fair. However, it is also evident that there are wide variations in terms and conditions in safety net awards and NAPSAs in the retail industry. The more awards with disparate provisions are aggregated the greater the extent of changes in the safety net. Changes may be able to be accommodated by a “swings and roundabouts” approach, specific provisions relevant to part of the industry or transitional provisions. However, significant changes may also result in net 387 Request from the Minister for Employment and Workplace Relations [2008] AIRCFB 550, [98] and Attachment B. 388 As notional agreements preserving state awards within the meaning of that term for the purposes of the legislation as in force at the time. 389 The Award Modernisation decision, [26]-[27]; [279]-[287]. 390 The Award Modernisation decision, [282]-[286]. [2026] FWCFB 75 149 disadvantage to employees and/or increased costs for employers. The publication of an exposure draft which sought to rationalise the terms and conditions across the various types of retail establishment provided a means whereby the impact of such an approach could be fully evaluated. We have considered these matters and the submissions of the parties and have decided to make separate awards for general retailing, fast food, hair and beauty, and community pharmacies. Further, we will exclude stand alone meat retailing and, at this stage, stand alone nurseries from the general retail award to enable those types of operations to be considered as part of the meat and agriculture industries respectively. The position regarding real estate agencies and motor vehicle related retailing will also be considered in subsequent stages. In reaching this decision we have placed significant reliance on the objective of not disadvantaging employees or leading to additional costs. We note that such an approach will not lead to additional awards applying to a particular employer or employee. The contents of the four awards we publish with this decision are derived from the existing awards and NAPSAs applying to the different sectors. Although the scope of the awards is obviously reduced, this did not eliminate the variations in terms and conditions within each part of the industry. We have generally followed the main federal industry awards where possible and had regard to all other applicable instruments. In this regard we note in particular the significant differences in awards and NAPSAs applying to the fast food and pharmacy parts of the industry.” [535] In the same decision, in deciding to make 17 modern awards in the priority stage, including the three the subject of these proceedings, the Full Bench considered junior and apprentice rates generally across the 17 modern awards as follows:391 “Junior and apprentice rates The federal awards and NAPSAs with which we are dealing contain a very wide range of rates for junior employees and apprentices. The relevant instruments fix percentages of the adult wage for juniors and apprentices based on a host of historical and industrial considerations, most of which can only be guessed at. It is not possible to standardise these provisions on an economy-wide basis, at least not at this stage. We have adopted the limited objective of developing new rates which constitute a fair safety net for each of the modern awards based on the terms of the relevant predecessor awards and NAPSAs. We have attempted to strike a balance as between, in some cases, wildly varying provisions. In the case of junior employees the rates will be expressed as a percentage of the rate for the relevant adult classification. In the case of apprentices the rates will generally be expressed as a percentage of the relevant trade rate.” [536] NAPSAs were not state awards, strictly speaking; they were “notional agreements preserving state awards.” For our purposes, though, the distinction is not material, and the reference to “NAPSAs” can essentially be read as a reference to state awards. The gravamen of the foregoing paragraph is that the Commission sought to synthesise disparate previous 391 The Award Modernisation decision, [71]. [2026] FWCFB 75 150 instruments in creating, inter alia, junior rates provisions for the new modern awards, in the limited time available. [537] The SDA submitted that junior rates were not further considered, other than in a rejected SDA application for junior rates in the General Retail Industry Award to not apply to trades classifications and higher classification levels. [538] As indicated above, the three modern awards the subject of these proceedings were created in the award modernisation process by reference to the body of industrial arbitration, relevant to the retail industry, that preceded it. Awards trace their origins to the factories and shops legislation initiated at the turn of the previous century and to early wages boards and conciliation and arbitration laws. Each of the predecessor instruments, referred to during award modernisation, that were considered in making these modern awards, had its own history. [539] As can be seen from the excerpt above the Full Bench made it explicit in the award modernisation process that they had adopted a limited objective of developing a fair safety net based on predecessor instruments and had “attempted to strike a balance as between, in some cases, wildly varying provisions.” Those wildly varying provisions had their origins in the arbitral history set out above, in which there had been different bases for setting junior rates. [540] In the 2012 Modern Awards Review392 the Full Bench said:393 “Two points about the historical context are particularly relevant. The first is that awards made as a result of the award modernisation process are now deemed to be modern awards for the purposes of the [Fair Work Act] … Implicit in this is a legislative acceptance that the terms of the existing modern awards are consistent with the modern awards objective. The second point to observe is that the considerations specified in the legislative test applied by the Tribunal in the Part 10A process is, in a number of important respects, identical or similar to the modern awards objective which now appears in s.136...” [541] The Full Bench went on to say:394 “These policy considerations tell strongly against the proposition that the Review constitutes a “fresh assessment” unencumbered by previous Tribunal authority. In circumstances where a party seeks a variation to a modern award in the Review and the substance of the variation sought has already been dealt with by the Tribunal in the Part 10A process, the applicant will have to show that there are cogent reasons for departing from the previous Full Bench decision, such as a significant change in circumstances, which warrant a different outcome.” 392 Modern Awards Review 2012 [2012] FWAFB 5600; 223 IR 49 (“2012 Modern Awards Review”). 393 Ibid, [85]. 394 Ibid, [88]-[89]. [2026] FWCFB 75 151 [542] The 2014 General Retail Junior Rates (20-year-olds) decision provided an overview of the award modernisation process with reference to the General Retail Industry Award.395 The Full Bench accepted that the issues raised in the award-making process concerning junior rates were confined and specific, and there had been no specific consideration given to the percentage of the adult rate which should be paid to a 20-year-old.396 They said:397 “…we are not persuaded by the employers’ submissions that the substance of the claim before this Full Bench was considered during the Part 10A process. We do not therefore need to consider whether there are cogent reasons to revisit it in the sense in which that “test” is referred to in the Modern Awards Review 2012 decision. It is necessary however for the SDA to establish a case on merit that the Award is not meeting the modern awards and minimum wages objectives…” (citations omitted) [543] In the 2020 General Retail Junior Rates (Classifications) decision, the Full Bench relevantly found:398 “1. It may be accepted that the Award Modernisation Full Bench did not give any consideration to the merits of junior rates in the Retail Award, but, rather, adopted the limited objective of establishing a fair safety net for each modern award based on the terms of relevant pre-reform instruments. 2. In making a modern award – including the Retail Award – the Award Modernisation Full Bench sought to strike a balance as to appropriate safety net terms and conditions considering the diverse pre-reform instruments in support of that draft award. It is fair to say that the Award Modernisation Full Bench adopted a broad ‘swings and roundabouts’ approach, having regard to the relevant pre-reform instruments.” Conclusion as to starting assumptions [544] In conclusion, having considered the history above and the circumstances in which the three awards were made, we do not start with an assumption that any of those three awards, insofar as they provided for junior rates, can be taken to represent a considered assessment of work value. Nor can we assume that the three awards, when made, were actually consistent with the now-in-force modern awards objective or, given the practical constraints, the then s 576B of the Workplace Relations Act, insofar as those awards made provision for junior rates. Whether we are satisfied variations are justified by work value reasons [545] We now turn to the question of whether varying the junior rates in each of the three awards would be ‘justified by work value reasons.’ For the reasons set out below we are satisfied that making a determination varying modern award minimum wages, in relation to 395 The General Retail Junior Rates (20-year-olds) decision, [11]-[27]. 396 The General Retail Junior Rates (20-year-olds) decision, [41]-[42]. 397 The General Retail Junior Rates (20-year-olds) decision, [45]. 398 The General Retail Junior Rates (Classifications) decision, [70]. [2026] FWCFB 75 152 employees aged 18 and over, in relation to each of the three awards, is justified by work value reasons. We start by considering the principles to be applied in considering whether variation is justified by work value reasons. Principles in considering whether justified by work value reasons [546] For the purposes of subsection 157(2)(a), the question is whether we are satisfied that each variation is ‘justified by work value reasons’. As indicated above the expression ‘work value reasons’ is defined in s 157(2A)399 and further affected by subsection (2B), which provide as follows: (2A) Work value reasons are reasons justifying the amount that employees should be paid for doing a particular kind of work, being reasons related to any of the following: (a) the nature of the work; (b) the level of skill or responsibility involved in doing the work; (c) the conditions under which the work is done. (2B) The FWC’s consideration of work value reasons must: (a) be free of assumptions based on gender; and (b) include consideration of whether historically the work has been undervalued because of assumptions based on gender. [547] In the Aged Care Stage 3 decision, the Full Bench said subsection 157(2A):400 “… defines what are ‘work value reasons’ for the purpose of sub-s (2). It is necessarily implicit in the scheme that, where an adjustment to award rates is considered to be justified for work value reasons, the existing award wage rates do not properly reflect the value of the work to which the work applies…” [548] In Gender-based undervaluation – priority awards review,401 the Expert Panel considered the work value provisions of section 157, along with the Pharmacy (APESMA Work Value Claim) decision402 and the Aged Care Stage 1 decision. We adopt, with respect, the following passage:403 “Because the existence of ‘work value reasons’ within the meaning of s 157(2A) ‘justifying’ the variation of modern award minimum wages under s 157(2)(a) is a matter about which the Commission must reach a state of satisfaction, the assessment required will involve an element of subjectivity and is one about which reasonable minds may differ. It may therefore be characterised as requiring the formation of a broad evaluative judgment involving the exercise of a discretion. ‘Justifying’ in s 157(2)(a) is to be given its ordinary meaning such that the work value reasons must show that the variation of modern award minimum wages is just, right or warranted, or provide a satisfactory 399 previously Fair Work Act s 156(4), but relocated with the repeal of the four yearly reviews in 2018. 400 Aged Care Stage 3 decision, [15]. 401 [2025] FWCFB 74 (“the Gender-based undervaluation decision”). 402 [2018] FWCFB 7621, 284 IR 121 (“Pharmacy (APESMA Work Value Claim) decision”). 403 The Gender-based undervaluation decision, [23]-[24], and the cases cited there. [2026] FWCFB 75 153 reason for the variation. The definition of ‘work value reasons’ in s 157(2A) requires only that the reasons justifying a variation of modern award minimum wages be ‘related to any of the following’ matters set out in paragraphs (a) – (c). The expression ‘related to’ is one of broad import that requires a sufficient connection or association between two subject matters. The degree of the connection required is a matter for judgment depending on the facts of the case, but the connection must be relevant and not remote or accidental. The reasons only need to relate to any of the three matters identified in paragraphs (a)–(c) — that is, any one or more of the three matters. It is significant that s 157(2A) does not contain any requirement for work value reasons justifying the variation of modern award minimum wages to consist of identified changes in work value measured from a fixed datum point. In this respect, the subsection differs from the work value change requirement under the previous wage-fixing principles which operated from 1975 to 1981 and 1983 to 2006. Nor does the subsection contain any requirement of the type formerly found in those wage-fixing principles that the change in the nature of the work should constitute such a significant net addition to work requirements as to warrant the creation of a new classification.” (citations omitted, emphasis in original) [549] In that decision, the Expert Panel went on to observe that previously Full Bench decisions had made clear that s 157(2) is broad enough to allow wide-ranging consideration of how work had been valued in the past. In respect of gender under-valuation, they considered these principles had been overtaken by the addition of new subsection 157(2B). We agree and consider that for other aspects of work value, previous Full Bench consideration remains apt. [550] The ARA submitted that section 157(2A) exhaustively defines “work value reasons", although the objects of the Fair Work Act will inform the interpretation and application of the concepts within s 157(2A).404 It submitted, and we agree, that subsection 157(2B) is clearly directed at eliminating gender-based assumptions in the Commission’s determination of work value reasons, and no such equivalent provision exists in respect of assumptions based on age. We agree that our consideration of work value is not to be directed to considering whether there had been age-based assumptions in previous assessments of work value that informed junior rates. We have not undertaken an exercise analogous to the gender undervaluation exercise required under subsection 157(2B), in respect of age. Nor is it necessary to consider whether there has been a change in work value, or to assume that the existing rates reflect some considered assessment of relative work value. Our task is to consider whether we are satisfied that variation is justified by work value reasons. That does not require a change in work value since an earlier assessment, or a finding of present undervaluation because of historical assumptions about age. To the contrary, we have directed our attention to what the evidence tells us about the value of the work performed by junior employees, in the context of the requirements of subsection 157(2A). [551] Having considered the principles to be applied we will now consider whether variation of each of the three awards is justified by work value reasons, having regard to the evidence to which we have referred, above. For reasons that will be apparent we are of the view different 404 ARA’s closing submissions, [86], relying on the Aged Care Stage 1 decision, [148], [293]. [2026] FWCFB 75 154 considerations apply to the value of the work performed by junior employees who are minors. So, we commence by considering the issue of whether variation of the junior rates payable to minors is justified by work value reasons. Minors [552] The ARA submitted that by proposing that junior rates for employees aged below 18 years of age be retained (albeit seeking that some of those rates would be varied), the applicant had accepted, to a degree, that the age of an employee is a relevant consideration for determining work value. We agree that the applicant has accepted there should be different rates for people aged under 18, notwithstanding the proportions are in contest. For our part we consider that in considering whether differences in work value can be assumed, or inferred from matters associated with age, minors should be treated differently to adults, including young adults. [553] As a matter of generality, we consider the value of minors’ work is likely to be less than the value of adults’ work having regard to, particularly, the level of skill or responsibility involved in doing the work, and the conditions under which the work is done. Our reasons for this view include the effect of restrictions on child employment in relation to availability, restrictions on duties (in respect of, for example, the sale of liquor or tobacco, or delivering food), availability constraints due to school commitments, and the factors relating to maturity, life experience, and opportunity to have obtained work experience, having regard to the short time that a minor has spent being of working age. In addition, we consider that the lay evidence to which we have referred above establishes that minors are generally given less responsibility at work than young adults who have accrued some work experience. We acknowledge this is a generalisation. [554] More importantly, whether or not the relative value of the work of minors of each age is accurately reflected in the percentages presently prescribed for junior rates, we have decided that it is not necessary to alter those percentages to meet the modern awards or minimum wages objectives. To the contrary we consider those objectives are better met through retaining, in the three industries the subject of these applications, junior rates set below the adult minima, for minors. We have set out our reasons in detail below but in essence, our view is that other factors, such as minors’ position of vulnerability, their greater disadvantage in the labour market, and the risks to them if they fail to participate in either employment, education or training, outweigh considerations in favour of variation, and support retaining the current arrangement of a gradual increase in rates from age 15 (or under), prior to adulthood at age 18. In light of our decision that it is not necessary to vary the rates for minors in order to achieve the modern awards objective, and the minimum wages objective, and noting that both requirements of subsection 157(2) of the Fair Work Act would need to be met for any variation to be made, it is not necessary for us to reach specific conclusions as to work value in respect of minors. Thus, our substantive work value consideration relates to young adults, to whom we now turn. Work value issues for young adults, across the three awards [555] We will consider the question of work value as across the three awards with specific findings for each. But first we make these observations that are applicable to all three. Though we are here making assessments as to work value for each award, many of the arguments about [2026] FWCFB 75 155 work value related to whether young people generally shared certain attributes, such as lesser maturity, or a propensity to be less productive, responsible, or accountable. We consider evidence in one industry can be considered in each of the other two in respect of qualities, characteristics and attributes said to be possessed by young people generally. [556] We first observe that we are dealing here with work subject to the same classifications but paid at different rates according to age, not with the work value relevant to the full adult rates for the classifications to which the junior rates apply. The question is whether variation to the junior rates is justified by work value reasons, not whether the current adult rates properly reflect work value. [557] Next, we wish to make a general comment about the MGA’s witness evidence. The MGA witness statements included evidence about junior employees generally, undissected by varying age cohorts. Ms Koch405 told us that all of her business’s junior employees were aged under 18. Mr Luchterhand told us he tended to hire people at age 14 to 15,406 and tended to lose them by attrition at around age 18, at which point he was talking to them about their future.407 However, he did have a 17-year-old supervisor and a 20-year-old supervisor at the Alex Pantry as at the time of the hearing.408 On the basis of the two employers’ hiring practices and employee age cohorts, we take their evidence about junior employees to substantially relate to junior employees who are minors. This is not a criticism, just an explanation as to how we treated their evidence. On the other hand, Mr Bongiovanni’s experience was with junior employees who were young adults, because he was a liquor store proprietor. Naturally the evidence that can be given by individual independent grocers and liquor stores would focus on their own business, whereas the larger firms can provide a broader view because of their scale. [558] Next, we note that the Ai Group described the existence of differential rates for the same work under the same conditions as being a distinct and accepted feature of the legislative scheme. It said the entire premise of junior rates, and the Fair Work Act’s support for the continued existence of junior rates, was that two individuals in the same classification, doing the same job, can appropriately be paid differently based upon their age. The SDA contends that within such a submission was an unstated assumption that junior rates are just a prescription of lower rates of pay for the same work, based on age.409 At hearing, the Ai Group referred to consideration in the 1999 AIRC Junior Rates Inquiry report suggesting that juniors were not as productive as adults. They went on to say that whatever be the case with that finding, they did not put forward their evidence to somehow justify lower wages or contend that junior employees are less worthy of adult rates of pay. It said it went to employer perceptions and hence hiring decisions. In closing, Ai Group submitted:410 “It's not our case - we're not seeking to persuade the Commission that there is a work value difference or there's not a work value difference. We note there was a finding of a work value difference in the Junior Rates Inquiry and … we don't put the case on the 405 PN1277 – PN1280. 406 PN4392. 407 PN4421 to PN4423. 408 PN4382, PN4388. 409 PN4536. 410 PN4940. [2026] FWCFB 75 156 basis that you will find strong evidence as if we had an onus to, as it were, introduce junior rates into the award for the first time.” [559] They went on to submit that though there was some material supporting differences in productivity and work value, the Ai Group considered they did not need to go that far, because what was relevant was the real world practical outcome on the ground, namely, “how are young people meant to obtain and retain a job?”411 [560] The Ai Group accepted that people who are hired to do the same job and who perform in the same classification perform the same or substantially the same tasks when at work.412 [561] These submissions were consistent with the way in which the Ai Group conducted their case against variations to junior rates. Though they raised some work value arguments in their written outline and in the evidence, their primary focus was on rationales for junior rates other than actual differences in work value. [562] Next, we note that we have not been given detailed empirical evidence or objective measures, of any difference in the value of the work performed by young people than by older people in the same jobs, attributable to their relative youth and its associated attributes. There was some evidence as to the different output as between junior team members (people aged under 20) and older adults in supermarkets, comparing stores with larger cohorts of junior team members with stores with a greater proportion of adult employees, which we have referred to below. The expert evidence and research focussed on matters other than work value, including the benefits of work to young people, the potential employment effects of the variations if made, the effects on the economy, the costs to employers, and whether there would be disproportionate consequences by firm size and geographic area if the variations were made. [563] Next, as to the effect of the variations proposed, the ARA submitted413 that the SDA’s proposed variations, insofar as they related to adult juniors, being the removal of junior rates for employees aged 18- to-20-year-olds, would involve: • an increase of 42.86% for 18-year-olds; • an increase of 25% for 19-year-olds; and • an increase of 11.11% for 20-year-olds to whom junior rates still applied. [564] It submitted that the increases were significant, particularly when contrasted to recent Annual Wage Review increases of 5.75% in 2023, 3.75% in 2024 and 3.5% in 2025. [565] In the context of work value the Ai Group made a submission that the business models of fast food restaurants have been developed on the assumed existence of junior rates of pay, and relied heavily on relatively low-cost labour.414 We do not consider this takes us very far in relation to considering whether we are satisfied that variations are justified for work value reasons. It implies that the juniors’ work is of high value to the employers because it is low cost. Ai Group also made submissions about the economic impacts, and financial impacts on 411 PN4943. 412 PN4972. 413 ARA’s closing submissions, [3]. 414 Ai Group’s outline of submissions, [31](d). [2026] FWCFB 75 157 employers, of the variations if made, as part of their submissions on work value. We consider these submissions misconceive the nature of the task in relation to work value. However, we consider these submissions relevant to our consideration of the modern awards and minimum wages objectives, below. [566] We will now deal with the work value issues in common across the three awards. For convenience we have ordered our consideration to follow the general framework of subsections 157(2A) and (2B). But we are applying the principles described above and engaging in a broad evaluative exercise. Nature of the work [567] The SDA submitted young adults performed the same duties, used the same skills, had the same responsibilities, and worked under the same conditions as workers aged over 21. They relied on their lay evidence to this effect.415 The SDA submitted that the nature of the work performed by young workers in the impacted classifications was not determined by age in any substantive or meaningful way. It submitted the employer lay witnesses had largely accepted that the duties that junior employees performed were the same as those of older employees.416 [568] The ARA made submissions about younger workers’ scope of duties and responsibilities, under the General Retail Industry Award, and the type of jobs in which they are likely to be employed. We consider these matters to be relevant but more apt to be discussed in the context of considering the level of skill or responsibility involved in doing the work. The level of skill or responsibility involved in doing the work [569] We heard argument about various issues related to skill or responsibility, including whether junior employees might be considered to be performing work within the same classification but with lower levels of skill or less responsibility, whether they performed a narrower range of, or fewer, functions, and whether they took longer to train or to become competent in the role. [570] The SDA submitted that to the extent that employees in the same job take on different responsibilities over the course of their employment, the evidence demonstrates that that is a reflection of their length of service, not their age.417 415 Citing Exhibit 50, Statement of EL (fast food), [31], [55], Exhibit 9, Statement of KM (pharmacy), [34]; Exhibit 15, Statement of KB (Retail/ Fast Food), [15], [31]; Exhibit 17, Statement of PB (Retail), [35], [39], [47]; Exhibit 18, Statement of RB (Retail/ Fast Food), [32]; Exhibit 22, Statement of BCA (Retail), [15]-[17]; Exhibit 25 Statement of CCR (Retail), [40] (though we assume this was intended to refer to [39]; Exhibit 26, Statement of LC (Retail), [29]; Exhibit 28,Statement of RD (Fast Food/ Retail), [27], [60], [96]; Exhibit 38, Statement of YH (Retail/ Fast Food), [38] (we assume this is intended to be a reference to [42]); Exhibit 40, Statement of IH (Fast Food/ Retail), [46], [85], [87]; Exhibit 46, Statement of TL (Retail), [56]; Exhibit 51, Statement of BM (Retail), [36], [39]; Exhibit 61, Statement of JP (Retail), [18]; Exhibit 64, Statement of AT (Retail), [32]; Exhibit 66, Statement of AW (Retail), [28]; Exhibit 67, Statement of MWH (Fast Food), [30], [41]. 416 Bridges PN3640; Koch PN1288-9; Sharp, PN2708; Exhibit 116, Affidavit of Mr King, [32]. 417 Citing Exhibit 8, Statement of CM (retail and pharmacy), [18] and [32]; Exhibit 10, Statement of BC (pharmacy), [21]; Exhibit 16, Statement of CB (fast food), [48]; Exhibit 15, Statement of KB (retail/ fast food), [43], [65]; Exhibit 29, Statement of KD (retail), [17]-[18]; Exhibit 73, Statement of BW (fast food), [32]; Exhibit 18, Statement of RB (retail), [2026] FWCFB 75 158 Training, experience, and the time taken to become competent [571] Relying on its lay evidence,418 the SDA submitted that training is consistent across all age groups and does not differentiate between employees doing the same job, regardless of their age. The SDA submitted that that training for junior employees across all three industries was often completed within two weeks.419 [572] The SDA said the evidence showed young workers consistently stated that they were comfortable performing their role and duties within a couple of months at the most. Unless they took on further responsibilities or worked in new departments their role did not change over time. To the extent that junior employees acquired further skills or took on further duties and responsibilities, they did so based on experience not age. [29]; Exhibit 37, Statement of CH (retail), [32]; Exhibit 38, Statement of YH (fast food), [17]-[18]; Exhibit 40, Statement of IH (fast food), [48]-[51]; Exhibit 41, Statement of AI (retail), [10]-[16]; Exhibit 42, Statement of KJ (fast food), [7]- [10]; Exhibit 45, Statement of CK (fast food), [18], [40]; Exhibit 50, Statement of EL (fast food), [27]; Exhibit 9, Statement of KM (pharmacy), [34]; Exhibit 54, Statement of SM (fast food), [34]; Exhibit 56, Statement of EM (fast food), [12], [18], [29]-[30]; Exhibit 57, Statement of JM (fast food), [30], [73]; Exhibit 61, Statement of JP (retail), [18]; Exhibit 63, Statement of BQ (fast food), [45]; Exhibit 64, Statement of AT (retail), [32]; Exhibit 66, Statement of AW (retail), [28], [62]-[63]; Exhibit 67, Statement of MWH (fast food), [41]; Exhibit 69, Statement of TW (fast food), [33]; Exhibit 70, Statement of LW (retail), [29]; Exhibit 71, Statement of ZWI (fast food), [65]. 418 Citing Exhibit 12, Statement of KP (pharmacy), [20]-[24]; Exhibit 20, Statement of BB (fast food), [15]-[20]; Exhibit 27, Statement of TOC (retail), [15]; Exhibit 14, Statement of WA (retail), [10]; Exhibit 16, Statement of CB (fast food), [49]; Exhibit 26, Statement of LC (retail), [28]; Exhibit 29, Statement of KD (retail), [29]; Exhibit 32, Statement of PF (retail and fast food), [30]; Exhibit 38, Statement of YH (retail), [27]; Exhibit 40, Statement of IH (retail and fast food), [121]- [122]; Exhibit 9, Statement of KM (pharmacy), [16]-[17]; Exhibit 54, Statement of SM (fast food), [25]; Exhibit 57, Statement of JM (fast food), [41]; Exhibit 60, Statement of MO (retail), [31]; Exhibit 61, Statement of JP (retail), [11]- [12]; Exhibit 62, Statement of JPH (retail), [17]; Exhibit 63, Statement of BQ (fast food), [50]-[52]; Exhibit 65, Statement of JT (retail), [14]; Exhibit 67 Statement of MW (fast food), [19]; Exhibit 71, Statement of ZWI (fast food), [45]-[46]; Exhibit 73, Statement of BW (fast food), [41]. 419 Citing Exhibit 34, Statement of MG (retail), [13]; Exhibit 50, Statement of EL (fast food), [9]-[10]; Exhibit 44, Statement of JK (retail), [13]; Exhibit 60, Statement of MO (fast food), [12]-[14]; Exhibit 14, Statement of WA (retail), [21]-[22]; Exhibit 15, Statement of KB (retail/fast food), [38]; Exhibit 16, Statement of CB (fast food), [11]-[13]; Exhibit 17, Statement of PB (retail), [28]-[31]; Exhibit 18, Statement of RB (retail/fast food), [9]-[10], [18]; Exhibit 19, Statement of AB (retail/fast food), [27]-[29]; Exhibit 20, Statement of BB (retail/fast food), [11], [36]-[37]; Exhibit 22, Statement of BCA (retail), [10]-[12]; Exhibit 23, Statement of DC (retail), [8]-[12]; Exhibit 24, Statement of CC (retail), [9]-[10]; Exhibit 25, Statement of CCR (retail), [17]-[26]; Exhibit 26, Statement of LC (retail), [14]-[15]; Exhibit 28, Statement of RD (retail/fast food), [19]-[21], [51]-[52], [78]-[81]; Exhibit 30, Statement of JE (fast food), [14]-[18]; Exhibit 31, Statement of OE (fast food), [16]-[20]; Exhibit 32, Statement of PF (retail/fast food), [15], [24], [47]-[51]; Exhibit 33, Statement of LG (retail), [13]-[14]; Exhibit 35, Statement of JG (retail), [8]-[9]; Exhibit 36, Statement of JH (retail), [10]- [12], [45]-[48]; Exhibit 37, Statement of CH (retail), [19], [26]; Exhibit 38, Statement of YH (retail), [9]-[11], [27]; Exhibit 39, Statement of SH (fast food), [12]-[13], [25]-[26]; Exhibit 40, Statement of IH (retail/fast food), [23]-[26], [70]-[75], [108]-[110]; Exhibit 41, Statement of AI (retail), [9]; Exhibit 42, Statement of KJ (fast food), [22]-[25], [62]- [64]; Exhibit 43, Statement of JKA (fast food), [9]-[11]; Exhibit 45, Statement of CK (retail/fast food), [12]-[14], [41]- [42]; Exhibit 46, Statement of TL (retail), [19]-[24], [48]-[51]; Exhibit 47, Statement of SL (retail), [13]-[15]; Exhibit 49, Statement of SLU (fast food), [10], [20]; Exhibit 50, Statement of EL (fast food), [9]-[10], [43]; Exhibit 51, Statement of BM (retail), [10]-[11]; Exhibit 8, Statement of CM (retail/fast food/pharmacy), [11]-[12]; [26]-[27], [39]; Exhibit 52, Statement of MM (retail), [13]-[16]; Exhibit 53, Statement of AM (retail/fast food), [7], [17]-[18], [28]-[29]; Exhibit 54, Statement of SM (fast food), [11]-[12]; Exhibit 57, Statement of JM (fast food), [12]-[13], [36]; Exhibit 58, Statement of DM (fast food), [13]-[14]; Exhibit 62, Statement of JPH (retail), [16]-[17]; Exhibit 63, Statement of BQ (fast food), [23]-[24]; Exhibit 64, Statement of AT (retail), [21]; Exhibit 65, Statement of JT (retail), [10]-[11]; Exhibit 67, Statement of MWH (fast food), [24]-[26]; Exhibit 68, Statement of MW (fast food), [8]; Exhibit 69, Statement of TW (fast food), [15], [30]; Exhibit 70, Statement of LW (retail), [9]-[11]; Exhibit 71, Statement of ZWI (fast food), [22]; Exhibit 72, Statement of MMC (Retail), [13]-[15]; Exhibit 73, Statement of BW (fast food), [28]-[29]. [2026] FWCFB 75 159 [573] It submitted that employer witnesses had accepted that the time it took for employees to become good at their job varied on a ‘case-by-case basis’, and depended on the qualities of an individual employee regardless of their age.420 The SDA submitted that employer lay witnesses had accepted that after six months, but often much sooner, most employees became competent or proficient at their job.421 We agree the evidence generally supports these propositions advanced by the SDA. [574] As to training arrangements, we accept that it is common for young adult workers (and younger) to do the same formal training as older workers, regardless of age.422 [575] As to experience, the SDA submitted that employer lay witnesses had accepted that junior employees, like all employees, became better at their jobs through experience,423 and that employees developed more confidence and greater proficiency in different parts of their role.424 The ARA submitted that Ms Bridges had not definitively accepted, under cross- examination, that employment experience was the major differentiator between younger workers and older workers.425 [576] The lack of experience in the workplace was not uniformly considered to be a downside of hiring juniors. Mr King of Terry White Chemmart stated that “there is a huge benefit in being able to train junior employees in your systems and procedures where they do not have any pre- existing behaviours from other workplaces.”426 [577] We accept that the younger a worker the more likely it is that they would need additional informal training and development because they have had relatively less time to gain experience in the workplace generally. This is a direct function of less experience, which is in turn at least associated with youth. Young adults have had a period of years of working age, and many have had the opportunity to obtain experience. On the other hand, some people enter the workplace later than others, or have periods away for study, caring, or other commitments, so this is necessarily a generalisation. We agree with the ARA’s submission that there is no reason to assume that all 18-year-olds have worked from the age of 15 or 16 and accumulated relevant work experience contributing to their work value, and this is not always the case.427 Maturity, life experience, personal attributes, ‘soft skills’ [578] The SDA submitted that the employer parties’ evidence had sought to draw a distinction between ‘formal duties’ and the informal duties (or the ‘soft skills’) performed by junior employees. It said the employer parties relied on that distinction to submit that it is the way in 420 Citing Wallace-Hughes, PN2527-8; Carrington, PN2764-5; Cousens, PN3730-3733; Bridges, PN3644-7; Knight, PN3920-5; On PN4168-9; Chisholm, PN4231-5. 421 Citing Koch, PN1284-7; Bridges, PN3691; Cousens, PN3735; Knight, PN3925-3929; On, PN4167-8; Carrington, PN2813-2821. See also PN4540, SDA oral closing submissions. 422 Wallace-Hughes, PN 2508-9; On, PN4161-3; Knight, PN3887; Sharp, PN2708. 423 Koch, PN1283-4; Johnston PN2325, Wallace-Hughes, PN2528-30; Bridges, PN3644-8; Knight, PN3898; Kennedy, PN4321-2; Zoghbi PN4066. 424 Wallace-Hughes, PN2528-30; Cousens PN3759-3765. 425 Referring to PN 3644-3647, 3654-3655 (Bridges cross-examination). 426 Exhibit 116, Affidavit of Mr King, [21]. 427 Relying on PN 3654 (Bridges cross-examination). [2026] FWCFB 75 160 which junior employees behave in their employment which justifies their discounted rates.428 It said the employers’ lay evidence had sought to paint junior employees as universally inexperienced, unsafe, unreliable with cash, slow, unable to problem-solve, prone to panic, frequently absent for mental health reasons, highly distractible, and dependent on constant supervision.429 While we do not consider the employer witnesses were claiming these characteristics were universal, we do consider their evidence was that these were characteristics of young people generally, or of the majority of young people. The SDA submitted these opinions were no more than generalisations and reflective of common stereotypes and other prejudicial views. [579] The various employer parties, including those that did not file evidence, made submissions that junior employees’ work was of less value than that of older workers in the same classifications, because of various attributes and issues including lesser maturity and life experience, competence and skills, and work experience. They considered younger workers to be less productive. It also referred to the work being of less value because younger employees were allocated different tasks and responsibilities within the same classifications. For example, the MGA submitted that junior employees consistently perform their job to a lower standard or not as efficiently as adult employees and are largely assigned significantly less responsibility and have less accountability than adult employees.430 [580] Though the employers’ evidence necessarily focused on the ways in which they considered junior employees’ work to be of lesser value, nonetheless many employer lay witnesses also described young people’s positive attributes,431 and expressed pride in their junior employees, and in the contribution the employers made to the community by providing entry-level work and training opportunities for young people. [581] As indicated above the Ai Group submitted,432 in respect of work value, that there are differences in relation to the quality of the work performed by junior employees compared to older employees. They gave an example from the statement of Mr Humphreys,433 a proprietor (via a trust) of nine Red Rooster restaurants. The example the Ai Group took us to, from Mr Humphreys’ witness statement, went to Mr Humphreys’ views about junior employees’ reactivity, inexperience, immaturity, greater likelihood of involvement in, and lesser ability to deal with, safety incidents, greater propensity to panic in relation to safety incidents, slower work, propensity for passing on difficult problems to more senior employees, greater difficulty with multi-tasking, issues with handling cash and recognising counterfeit currency, greater need for direction, greater propensity for mental health issues and more need for time off and EAP assistance as a consequence of mental health issues, greater propensity to become frantic, stressed, and upset when they make mistakes, and greater likelihood of becoming distracted by friends and their phones. Despite this, Mr Humphreys told us, under cross-examination, around 428 Citing, for example, the ARA’s outline of submissions, [48], [52]; Ai Group’s outline of submissions, [25](c) and (d), [31](c) and (e); and MGA’s outline of submissions, [89](d)(ii). 429 Citing, for example, the witness statements of Mr Humphreys (Exhibit 101) and Ms Bridges (Exhibit 109). 430 MGA’s outline of submissions, [62], [97]-[99]. 431 For example, Ms Cousens’ statement (Exhibit 110), [27]-[36]; Mr Carrington’s statement (Exhibit 94), [39]; Mr Bongiovanni’s statement (Exhibit 118), [36]. 432 Ai Group’s outline of submissions, [31](e). 433 Witness Statement of Mr Humphreys (Exhibit 101), [17]-[30]. [2026] FWCFB 75 161 half of the managers across his stores were aged under 21: there were 22 managers under 21, out of 40 to 45 managers in total. In addition, Mr Humphreys told us that of his 215 non- managerial staff, around 90% to 95% were under 21. It is difficult to reconcile Mr Humphreys’ opinions on the shortcomings of junior employees with the age composition of his workforce including his restaurants’ managers. [582] MGA drew our attention to Mr Bongiovanni’s statement:434 “The practical skills and experience of a junior employee are not as developed as a senior employee who has already been in the workforce for some time. I find that the differences between my junior and senior employees are mainly in regard to product knowledge, customer service and attention to detail’.” [583] It also referred us to the following passage from Mr Luchterhand’s statement:435 “The overall difference between junior employees and adult employees I have seen in my business is the level of maturity, initiative and care that they display in their work. This leads to a crucial difference in the output of junior employees when compared to adult employees.” [584] MGA also referred us to Mr Luchterhand’s statement436 as to junior employees’ lack of life experience, the impact of that lack on efficiency and effectiveness, and junior employees’ lack of the social and analytical skills that an adult employee would usually have. The MGA said junior employees were more susceptible to performing their work less efficiently, making more mistakes, and being assigned lesser responsibilities, relying on Ms Koch’s statement.437 [585] The ARA’s closing submissions included the following:438 “Adult employees often have previous work experience which can contribute to greater confidence, knowledge, responsibility, life experience, emotional intelligence, reliability and independence in performing their duties.439 Whereas, junior employees are often at the beginning of their working career and are still learning how to work effectively in a retail environment.440 This means that adult employees are often better able to engage with training and require less day-to-day guidance and support.441 Further, junior employees may not possess the necessary judgement or skill to fulfil the “shopping” or “picking” requirement of a delivery or click and collect order due to not having fully developed the relevant soft skills or attention to detail or accumulated 434 Exhibit 118, Statement of Mr Bongiovanni, [14] to [15]. 435 Exhibit 117, Statement of Mr Luchterhand, [12]. 436 Exhibit 117, Statement of Mr Luchterhand, [15]. 437 Exhibit 74, Statement of Ms Koch, [21]. 438 ARA’s closing submissions, [112]-[114]. 439 Citing Exhibit 110, Ms Cousens’ Statement, [41]; Exhibit 109, Ms Bridges’ Statement, [53], [59]. 440 Citing Exhibit 110, Ms Cousens’ Statement, [41]. 441 Citing Exhibit 110, Ms Cousens’ Statement, [39]-[41], and see also Exhibit 109, Ms Bridges’ Statement, [57]. [2026] FWCFB 75 162 sufficient life experience which would enable the determination of proper “like for like” substitution of products.442 Similarly, junior employees tend not to be rostered to attend to replenishment of certain products because of the need for a high level of attention to detail and patience.443 In terms of soft skills, junior team members require significantly more “on-the-job” guidance.444 This has been particularly pronounced since the COVID-19 pandemic where managers have been required to place greater emphasis on these skills with junior team members.”445 [586] As these passages relied on the statements of Ms Cousens and Ms Bridges, we take them to be referring to junior employees aged 19 and under. [587] We heard various other statements and opinions about the connection between maturity and life experience on the one hand, and competence, productivity, and quality of work on the other, including from the employer parties that led evidence. [588] The employer lay witnesses’ views about maturity deficits and their effects on work value were largely undissected as between age cohorts. [589] The SDA submitted that when the employer witnesses referred to qualities such as ‘soft skills’, ‘multi-tasking’, and ‘rostering nuance’, they are describing skills that are acquired by junior employees through training and experience.446 It submitted the generalised criticism of junior employees made by employer witnesses was wrong. The SDA submitted that young workers take their work seriously; they work efficiently and responsibly.447 [590] The issues of maturity, life experience, and soft skills are matters that can go to both skill levels and levels of responsibility. In the 1999 AIRC Junior Rates Inquiry report the Full Bench stated that “age is an acceptable proxy for an intuitively formulated set of maturation deficits or skills commonly associated with the initial performance of young employees.” As a proxy measure, any consideration of maturity and life experience as a function of age must necessarily involve generalisation. A number of employer lay witnesses said they considered maturity varied among junior employees.448 Employer lay witnesses also agreed that the level of maturity of 15-year-olds was different from the level of maturity for 18- or 20-year-olds.449 [591] We consider it uncontroversial to take the view that minors are less mature than adults. A combination of less maturity and an absence of life experience may have consequences for the value of the work that they perform. On the other hand, we do not consider the evidence 442 Citing Exhibit 109, Ms Bridges’ Statement, [50]. 443 Citing Exhibit 109, Ms Bridges’ Statement, [51]. 444 Citing Exhibit 109, Ms Bridges’ Statement, [56], [58]. 445 Citing Exhibit 109, Ms Bridges’ Statement, [58]. 446 Exhibit 55, Reply Statement of SM, [12]; Exhibit 59, Reply Statement of DM, [8]-[11], [23]. 447 Exhibit 48, Reply Statement of SL, [22]; Exhibit 21, Reply Statement of BB, [6], [8]. 448 Humphreys, PN3451 Luchterhand, PN4408; Johnston, PN 2331-PN2332; Cousens, PN3730, PN3737-PN3738. 449 Bridges, PN3653; Cousens, PN3737. [2026] FWCFB 75 163 shows that young adults are generally and materially less mature than adults aged 21 and over to the extent that it affects the relative value of their work. Whether less productive [592] The ARA submitted that in the context of supermarkets, stores with a larger junior team member cohort spend considerably more hours to achieve the same productivity outcome as stores who roster predominantly adult team members. This makes clear that junior team members in that context are, overall, less efficient. To support this contention, they relied on Ms Bridges’ witness statement in relation to Coles, which provided a summary statement but not the underlying data, as follows:450 “Given the additional supervision required of junior team members, engaging junior team members tends to result in more hours being worked than if we were to only engage adult team members. That is, Coles' rostering spends more hours in order to roster juniors, to achieve the same overall output. In my experience, comparing Coles' stores who roster a greater number of junior team members against Coles' stores who roster fewer, the stores with a larger junior team member cohort spend considerably more hours to achieve the same productivity outcome as stores who roster predominantly adult team members. Although either approach may remain within the allocated budget (due to the existence of the junior rates framework facilitating the rostering of more junior hours without increasing costs), in my experience the requirement to use more hours for juniors is an indicator of their overall efficiency when compared to adults. This reflects a common sense understanding that junior team members are less experienced, are still developing their skill set, and require increased supervision and guidance from their adult colleagues.” [593] Otherwise, as can be appreciated from the lay witnesses’ evidence set out above, the employer parties’ evidence as to productivity was general and anecdotal. We heard of the experiences and opinions of various lay witnesses, on both sides of the case, about whether there was a productivity difference arising from age. These opinions were in general and anecdotal terms. Lay witnesses also considered there to be a reasonable amount of variation in the productivity of different workers of the same age. [594] Youth Law Australia submitted that the existing junior wage schedules in these Awards are not commensurate with work value as the productivity, level of skill and responsibilities of workers of different ages is the same, or more similar than the difference in wages. It submitted a disproportionate number of younger workers are employed in unskilled and service roles within the Fast Food and Retail sectors, where the productivity gains from experience are minimal.451 It submitted this negates any argument that gaining skills or experience is necessary to achieve organisational productivity and efficiency.452 [595] The Full Bench in the 2014 General Retail Junior Rates (20-year-olds) decision had considered that lesser productivity and lesser value to the employer had long been accepted by 450 Exhibit 109, Ms Bridges’ Statement, [62]. 451 Citing Blackham, A. (2019). ‘Young Workers and Age Discrimination: Tensions and Conflicts’ (2019) 48(1) Industrial Law Journal 1, 28. 452 Citing Sargeant, M. (2010). ‘The UK National Minimum Wage and Age Discrimination’ (2010) 31(3) Policy Studies 351, 353. [2026] FWCFB 75 164 tribunals, in respect of “young workers.” We have referred to the relevant passage below, in our consideration specific to the General Retail Industry Award. As indicated elsewhere within this decision, that decision was made under different statutory provisions and did not require justification on work value reasons. However, the consideration undertaken in relation to the modern awards and minimum wages objectives did include, as can be seen from the foregoing excerpt, consideration of whether there was any difference in the duties and responsibilities, or the supervision, of 20-year-old retail employees. [596] We accept that generally efficiency and productivity are more reliant on experience than on age.453 In the case of young adults, we do not consider we can simply assume that they are materially less productive than workers older than them, especially in the lower classifications. Nor can we just assume that there would be high productivity returns to experience for unskilled or low-skilled jobs. On the other hand, the greater reliance on experience does not mean age has no part to play and we consider it likely that the younger the employee, the more relevance maturity has to productivity. [597] Having considered the foregoing, we do not find there is a productivity differential sufficient to tend to indicate materially greater skill as between young adults and adults aged 21 and over. Task allocation [598] We accept the evidence that there are certain duties that some young employees cannot lawfully perform, including in relation to the sale of cigarettes and the sale of alcohol. Those employees cannot perform the full range of functions. But these limitations do not apply to young adults, save for the limitation in relation to delivery drivers, in some areas, needing green P plates.454 Coaching, supervisory and management responsibilities [599] It is clear from the lay evidence that it is common for young adults to hold supervisory, and even, to a lesser extent, management roles in the general retail and fast food industries. In many cases it was accepted that junior employees supervised older workers.455 [600] Ms Bridges said generally young workers did not have supervisory roles. However, she agreed that sometimes workers aged 16 and 17 had supervisory roles, as did workers aged 18, 19 and 20. Asked whether it got more common for workers aged 18, 19 and 20 to hold supervisory roles, Ms Bridges said, “the more experienced they are, the more common, yes.” She agreed that experience was the litmus test for whether the person had a supervisory role.456 [601] In the fast food industry, there was evidence of junior employees holding management, not just supervision, positions. Ms Wallace-Hughes of McDonald’s accepted that if junior employees were appointed to positions of leadership it was because they performed their duties well. They were reliable and mature and took their work seriously.457 Ms De Witte of Craveable 453 Exhibit 55, Reply Statement of SM, [10], [18] -[19]; Exhibit 21, Reply Statement of BB, [16], [20]-[22]. 454 PN3679. 455 Humphreys, PN3424-25; Bridges, PN3659-61; Carrington PN2800-05. 456 PN3659-PN3665. 457 Wallace-Hughes, PN2557-9. [2026] FWCFB 75 165 Brands agreed that where junior employees were promoted to leadership positions it was because they were good at their jobs.458 [602] The SDA summarised some of the relevant evidence regarding the prevalence of junior employees in supervisory and managerial roles in their closing submissions. We accept their summary, which was as follows:459 “For example, at McDonalds, managerial and supervisory roles are performed by junior employees.460 Over a third – 32.26 per cent – of McDonald’s FFIA [Fast Food Industry Award] Level 2 Shift Managers are under the age of 21. McDonalds employs 2,627 shift managers who are between the ages of 18 and 20. A Level 2 Fast food employee has the “major responsibility on a day-to-day basis for supervising Fast Food employees Level 1 and/or training new employees.”461 Likewise, the employers’ generalised evidence about junior employees lacking leadership, requiring supervision and being unreliable with cash, etc, is at odds with the fact that a number of junior employees at McDonalds are employed as an FFIA Level 3 Restaurant Manager. Including 11 Restaurant Managers who are just 19 years of age.462 Each McDonalds restaurant is a business worth millions of dollars.463 An FFIA Level 3 Manager is appointed by the employer to be in charge of that food outlet. At Craveable Brands, which own and operates Red Rooster, Oporto, Chicken Treat and Chargrill Charlies franchises, a significant percentage of managerial and supervisory roles are performed by junior employees:464 (a) 72.98% of all its Crew trainers are under 21 years of age. (b) 29.44% of all shift supervisors are under 21 years of age. (c) 11.04% of all Assistant Managers are under 21 years of age.” [603] Of the three industries, this was the one that had the most evidence of junior employees performing management, supervision and training roles. [604] The SDA submitted that junior employees were able to take on positions of higher responsibility. They pointed out that junior employees trained older employees, and supervised and managed older employees. [605] The SDA submitted that employers’ propensity to hire junior employees into supervisory and managerial roles contradicted their evidence as to general maturity, life experience, and ‘soft skill’ deficiencies. The fact that junior employees are hired in supervisory and managerial roles highlights the limits of the usefulness of generalisations based on age. 458 De Witte PN2638; Wallace-Hughes, PN2557-8. 459 SDA closing submissions, [294]-[296]. 460 Exhibit 104, Statement of Mr Turner, [7]. 461 Referring to cl 12(b) of the Fast Food Industry Award, which we take to be a reference to cl 12.4(b). 462 Exhibit 104, Statement of Mr Turner, [7]. 463 Citing Exhibit 97, the statement of Mr Beattie, at [16]. The specific purchase price range was confidential, but we consider this submission to be sufficiently general that it does not reveal confidential information. 464 Exhibit 92, Statement of Ms de Witte, [11]. [2026] FWCFB 75 166 [606] The evidence shows that it is common for young adults to hold training, supervisory and even management roles in the fast food industry. We agree with the Full Bench in the 1999 AIRC Junior Rates Inquiry report in relation to the limits of the concept of maturity when it comes to “juniors” who work as managers. The Full Bench said:465 “Performance by a junior of managerial functions is an implicit contradiction of the rationale of junior rates as an offset against a junior employee’s deficit in the maturation attributes. The retail award quoted at paragraph 3.5.2.2 includes a provision that would adjust rates during performance of the management role, but reversion to the discounted rate thereafter is assumed. Reversion to the bare age related junior rate after a significant period of performance of duty at managerial level appears to be inconsistent with equal remuneration being given for work of equal value in the sense that that expression is used in Australian industrial principle. The value of work to be assessed under that principle may be affected or modified by the notion of maturation factors. But those factors are not contradictory of the principle itself.” [607] We consider these views to be apt for junior employees performing supervisory and training functions as well, to a lesser extent. It is difficult to accept that firms would have unproductive and immature employees managing, supervising, or training others. [608] The lay evidence of junior employees performing training, supervisory and management duties militates against a finding that, particularly, young adults have such a pronounced maturity, life experience or soft skills deficit compared to adults aged 21 and over that their work is of such lesser value as would give rise to a significant difference in work value. The conditions under which the work is done [609] We now address the conditions under which the work is done, starting with the parties’ submissions about whether junior employees require more supervision. Whether junior employees require more supervision [610] The SDA submitted that junior employees perform work in departments or in stores by themselves. It submitted junior employees often work alone or with limited supervision,466 and are not supervised differently or more extensively than older workers.467 In contrast, employer parties argued junior employees required more supervision. The ARA submitted that in circumstances where there are a high proportion of junior employees, relevant supervision by experienced team members was required to be rostered to provide appropriate oversight and 465 1999 AIRC Junior Rates Inquiry report, [4.2.4]. 466 Citing Exhibit 23, Statement of DC (retail), [15]; Exhibit 50, Statement of EL (fast food), [46]; Exhibit 24, Statement of CC (retail), [10]-[11]; Exhibit 69, Statement of TW (retail & fast food), [31]-[33]; Exhibit 72, Statement of MMC (retail), [29]-[30]; Exhibit 62, Statement of JPH (retail), [28]; Exhibit 64, Statement of AT (retail), [41]; Exhibit 50, Statement of EL (fast food), [50]-[51]; Exhibit 47, Statement of SL (fast food), [37]-[38]; Exhibit 36, Statement of JH (retail), [30]; Exhibit 34, Statement of MG (retail), [32]; Exhibit 32, Statement of PF (retail), [50]-[51]; Exhibit 14, Statement of WA (retail), [10]; Exhibit 15, Statement of KB (retail), [60]; Exhibit 17, Statement of PB (retail), [20]-[21]; Exhibit 27, Statement of TOC (retail), [16]; Exhibit 72, Statement of MMC (retail), [29]-[30]; Exhibit 29, Statement of KD (retail), [18]. 467 Citing Exhibit 57, Statement of JM, [54] (fast food); Exhibit 56, Statement of EM, [30] (retail); Exhibit 48, Reply Statement of SL (retail), [12]; Exhibit 55, Reply Statement of SM, [23] (fast food). [2026] FWCFB 75 167 support for the purposes of safety and productivity, such as where junior employees are rostered to perform manual handling tasks during and after school shift.468 It submitted a critical difference between the work value of junior employees and adult employees is the manner in which the task is performed and the relevant level of supervision required to ensure overall greater productivity.469 The Ai Group argued that young people required greater supervision,470 and hiring young workers with little work experience incurred additional training and supervision costs.471 The MGA made a similar submission.472 The Pharmacy Guild submitted that there is an increased level of on-the-job supervision for junior employees, to maintain productivity and ensure safety of the employees and customers.473 [611] This was an area of substantial disagreement between the lay witnesses. The witnesses’ tendency to discuss the supervision requirements for junior employees generally, undissected by age cohort, makes it more difficult to assess the evidence. But having regard to it as a whole we find that it does not suggest a substantial difference in the amount of supervision for young adults compared with workers older than them. We would expect that minors would have the benefit of greater supervision. Whether lesser performance expectations or greater tolerance of mistakes [612] The Ai Group submitted that the fact that the work is performed by young people means that there is an acceptance (and tolerance for) higher rates of mistakes, and higher rates of supervision to identify and address those mistakes. We have dealt with the issue of supervision above. As to mistakes, the Ai Group referred us to a passage from the witness statement of Ms Wallace-Hughes in which she had stated:474 “… McDonald’s will consider age when issues arise around breaches of workplace policies - for example, if they are a 15 year old versus a 21 year old. We are a lot more understanding of minors not following a policy than someone who is say 30 years old and doing the same thing – we would consider the situations very differently.” [613] This focusses on minors and more broadly suggests that the younger the worker, the greater the tolerance of policy breaches. It is not clear from this passage whether an 18-or-19- year old would have more lenience for policy breaches than a 21-year-old. 468 Citing Exhibit 110, statement of Ms Cousens, [52] and also Exhibit 109, statement of Ms Bridges, [59]. 469 Citing Exhibit 109, statement of Ms Bridges Statement, [60], [62]. 470 Citing Exhibit 93, statement of Ms Sharp, [16]-[24], though these paragraphs relate to training rather than supervision; and Exhibit 89, statement of Ms Wallace-Hughes, [37], though this relates to being more understanding when junior employees breach policies, rather than supervision. 471 Referring to Exhibit 86, statement of Ms Johnston, [38]–[49]. Also Exhibit 88, Statement of Mr Morton, [29]–[31]. We also observe similar evidence appeared in Exhibit 94, statement of Mr Carrington, [35]. 472 MGA’s outline of submissions, [68] and following. 473 Lay witnesses whose evidence supported this proposition included, for example Ms Chisholm, Exhibit 114, [28]-[34]; Mr King, Exhibit 116, [38]-[40]; Ms Knight, Exhibit 111, [34]-[36]; Mr On, Exhibit 113, [41]-[44]; Ms Kennedy, Exhibit 115, [33]-[37]; and Mr Zoghbi, Exhibit 112, [44]. 474 Witness statement of Ms Wallace-Hughes, Exhibit 89, at [37]. [2026] FWCFB 75 168 [614] We accept that the evidence shows that supervisors and managers generally set duties and expectations of employees’ performance based on their experience and their skillset, not their age.475 Whether need for multi-tasking reduced in recognition of high proportion of young workers [615] The Ai Group submitted476 that even if the work performed were found to be similar regardless of an individual’s age, systems have been arranged to account for the high rates of young employees, including in relation to levels of supervision and simplification of tasks (as opposed to multi-tasking), that would likely not be the case were it not for the high rates of juniors. To be clear this submission relates to systems design, and is not, as we understand it, a submission that the same jobs are being organised differently according to the age of each employee. We have considered supervision levels above. [616] As to task simplification, we observe that the evidence in the fast food industry suggests the use of multiple discrete “stations” in the big firms. Task simplification and an approach that is more like that of a factory than a restaurant is, we would expect, part of what makes fast food fast. [617] We do not consider the evidence supports the proposition that there has been task simplification to the same extent in general retail. Large supermarkets and department stores appear to have multiple departments or sections, so that a person might be working on checkouts, or in the ‘party’ section, for example, but the tasks themselves do not appear separated to the same extent. There appears to be less separation of tasks in liquor and independent grocers.477 [618] Systems innovation is a form of technological change, which would be expected to improve productivity and efficiency. It appears to us that low skill jobs are more susceptible to being reduced to individual tasks, particularly in big firms. However, we do not consider this issue assists us in considering the work value issues before us in this case. Availability and rostering [619] There was evidence about junior employees’ availability. We accept that young adults may generally have different availability patterns and preferences than older adults, including because of study commitments. Some of the employer witnesses indicated that this was a benefit of employing junior employees because it helped them cover their rosters at certain times of the week and on weekends.478 [620] We accept the evidence shows that where age is considered in making employment and rostering decisions for junior employees, what is decisive is the costs savings from rostering younger workers, and not work value.479 Child employment legislation also constrains rostering but is not relevant to our present exercise of considering work value specifically in relation to young adults. 475 Exhibit 55, Reply Statement of SM, [17] ; Exhibit 21, Reply Statement of BB, [12] (retail and fast food). 476 Ai Group’s outline of submissions, 31(b). 477 Mr Luchterhand, PN4402. 478 For example PN4028-PN4029, Mr Zoghbi; PN3883, Ms Knight; PN4268-PN4271. 479 Exhibit 56, Statement of EM (retail), [30]; Exhibit 10, Statement of BC (pharmacy), [27]. [2026] FWCFB 75 169 Gender [621] Before turning to the individual awards, we will deal with section 157(2B). No party submitted there had been historical gender-related undervaluation affecting the relativities between junior rates and adult rates in any of the three awards. In our view our consideration has been free from assumptions based on gender. Having dealt with gender we will now consider matters specific to the General Retail Industry Award. The General Retail Industry Award [622] The MGA submitted that the SDA’s proposals did not suggest there has been any material change in circumstances since previous reviews of junior pay rates. They considered the application was essentially an attempt to resubmit a policy position that the Commission had previously rejected. We have indicated above why the authorities do not require a change in work value and why we do not consider that we should proceed from a starting assumption that the awards as made reflected work value. We have also considered the decision in General Retail Junior Rates (20-year-olds) decision. [623] The ARA also referred us to that decision and the judicial review proceedings that left it undisturbed. The 2014 General Retail Junior Rates (20-year-olds) decision was made in the context of the review of all modern awards as required by Item 6, Schedule 5 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 and did not require an assessment of work value in the same way as these current proceedings do. The task, in the review of modern awards at the time, was to consider whether each modern award achieved the modern awards objective. It was also to consider whether each modern award was operating effectively, without anomalies or technical problems arising from the award modernisation process.480 [624] Relevantly, the Full Bench in the General Retail Junior Rates (20-year-olds) decision considered the modern awards objective in some detail but did not provide a detailed examination of work value. They referred481 to the 1999 AIRC Junior Rates Inquiry report including a passage in which the (1999) Full Bench had said:482 “…some degree of discounted pay rate for entry level work continues to be necessary. It seems needed, at least as an equal opportunity measure, in the areas in which employment under junior rate classifications is most concentrated. It is probably necessary also as a reflection of the ‘true value’ of the work to the employer, taking account of maturation factors…” [625] The Full Bench in the General Retail Junior Rates (20-year-olds) decision considered this rationale remained relevant.483 They went on to say:484 480 General Retail Junior Rates (20-year-olds) decision, [4]. 481 General Retail Junior Rates (20-year-olds) decision, [99]. 482 1999 AIRC Junior Rates Inquiry decision, [4.4.4]. 483 General Retail Junior Rates (20-year-olds) decision, [103]. 484 General Retail Junior Rates (20-year-olds) decision, [104]. [2026] FWCFB 75 170 “The productivity of young workers and value to employers being less than that of adult employees has been long accepted by Federal and State industrial tribunals. Junior rates reflect the general lack of experience of young employees and can act as an incentive or encouragement to employers to engage young persons, thereby allowing young persons to get a start or foothold in employment when they might otherwise struggle to compete against older applicants. Further, it is generally the case that the engagement of young persons will be associated with additional costs to the employer because of training and supervision needs.” [626] As can be appreciated, the Full Bench in the General Retail Junior Rates (20-year-olds) decision, in 2014, took into account experience and additional training costs, as well as referring to labour market disadvantage. [627] The Full Bench considered 485 a number of contentions by the SDA. These included a content that “there is no difference in the work and duties performed by a 20-year-old Retail Employee Level 1 as compared to a 21 year old Retail Employee Level 1.” They found486 the evidence supported a general conclusion to that effect, and that the evidence consistently stated the nature of the work performed by a 20-year-old and a 21-year-old employee in the retail industry was the same. They also accepted487 the SDA’s contention that “most retail employees achieve a satisfactory level of proficiency in respect of Retail Employee Level 1 duties and responsibilities after about six months of employment.” [628] In General Retail Junior Rates (Classifications) decision the Full Bench was considering the four yearly review provisions which as indicated above were in more similar terms to the current s 157. Accordingly, the Full Bench was required to consider whether it was satisfied the proposed variations to reduce the number of classifications to which junior rates applied were justified for work value reasons.488 The Full Bench considered the evidence on work value in the 2020 case to be insufficient, but identified anomalies in relation to the treatment of classifications 4 and above. They considered their decision to vary the General Retail Industry Award, so that junior rates applied only to classification levels 1, 2 and 3, to be justified by work value reasons, particularly the level of skill involved in doing the work when compared to equivalent classifications in other awards.489 The nature of the work [629] The junior rates under consideration here apply to jobs within the Levels 1, 2 and 3 classifications of the General Retail Industry Award. The lay evidence assists in understanding the distribution of junior employees across the three classifications. We take from that evidence that in Coles, Kmart and Target, persons under 20 are employed across the three classification levels (or equivalents under the enterprise agreements) and are more concentrated in roles within the level 1 classification. The MGA witnesses did not say which classification(s) their 485 General Retail Junior Rates (20-year-olds) decision, [94]. 486 General Retail Junior Rates (20-year-olds) decision, [94(4)]. 487 General Retail Junior Rates (20-year-olds) decision, [94(5)]. 488 General Retail Junior Rates (Classifications) decision, [26]. 489 General Retail Junior Rates (Classifications) decision, [82]-[86]. [2026] FWCFB 75 171 junior employees were employed under, only that they had been paid in accordance with the General Retail Industry Award. [630] In the circumstances, we consider the nature of the work to be consistent as between older employees and junior employees. Generally, work performed in the same function, under the same classification, is of the same nature. The issue of the number or range of functions performed is better considered in the context of the next limb. The level of skill or responsibility involved in doing the work [631] The classification definitions have the effect that the difference between Level 1 and Level 2 is one of higher skill level, and between 2 and 3, higher level. Thus, if an employee is performing different functions because of their greater skill, this can be addressed through re- classification. However, we are here considering whether the value of junior employees’ work is less than that of other employees’ work, in jobs or functions within the same classification. We first consider the evidence in relation to the amount of training required, or time taken to become competent. Amount of training required and time taken to become competent [632] An issue in contest was the amount of training required for junior employees compared with other employees, and how long junior employees took to become competent to perform their jobs. [633] The ARA’s witness Ms Bridges agreed under cross-examination that someone who started at age 15 or 16 would have a pretty good handle on their role by three to six months, depending on which department they were in.490 [634] The MGA argued that the lay evidence showed that employers were required to invest significant amounts of time and resources in training and supervising junior employees. The training provided by employers went beyond just teaching junior employees how to undertake the practical aspects of their employment and taught junior employees important life and career skills which would set them on a successful career path.491 Mr Luchterhand’s evidence was that it took two to two-and-a-half years for the junior employees he hired at age 14 or 15 to learn their jobs,492 including working with food. Mr Bongiovanni said it took someone with no knowledge of wine a couple of years to work independently without supervision, and that older adults were more likely to have knowledge of wine.493 [635] It appears that in the big retailers it was not in contest that a junior employee could become competent or proficient within a matter of months. We do not consider the evidence from the independent grocers takes this issue very far because of the witnesses’ general practice of employing minors and not young adults who we are considering in this part. The liquor store evidence is the outlier; it is obvious to us that Mr Bongiovanni has high expectations consistent with providing a high-quality service, with knowledge of wine being critical. 490 PN3691. 491 MGA’s outline of submissions, [69]. 492 PN4401. 493 PN4486 to PN4504. [2026] FWCFB 75 172 [636] We take from the evidence that once an employee has been in the job for a short period, and not more than six months, they are trained and able to perform their job competently. This is broadly consistent with the finding in the General Retail Junior Rates (20-year-olds) decision, albeit that finding related only to 20-year-olds:494 “The evidence presented by both the SDA and the employers generally supports a conclusion that most junior retail employees achieve a satisfactory level of proficiency in their roles after about six months in employment. Further, much of the evidence suggests that there is little difference in the duties and responsibilities assigned to 20 and 21 year old retail employees or in the level of supervision required in relation to those employees.” Task allocation, and range or number of tasks or functions [637] As to whether there is a different allocation of tasks as between young adults and people aged 21 and over, the SDA submitted that at least one of the employer witnesses, Ms Bridges, agreed that employees in the same job were performing the same duties regardless of age.495 The passage from Ms Bridges’ evidence, cited in support of this submission, stated that if a customer approaches a junior team member with a question or a complaint, although the junior team member may initially speak with the customer and assist with triaging the issue, the matter will usually be passed onto the customer service manager or supervisor in charge to be addressed. In the next paragraph, though, she qualified her evidence about the work performed by junior team members, saying that those 18 and older performed “some similar duties” to “adult team members.”496 Under cross-examination Ms Bridges said that adult workers might also refer complaints to supervisors. As to questions, she said the ability to answer them depended on experience, of which more was gained the longer someone worked in a supermarket. [638] The ARA submitted that junior employees in certain retail operations may be less likely to perform roles which involve a high level of direct customer interaction or the management of complex inquiries including challenging customer behaviour, such as at a service desk or customer greeter positions.497 Ms Cousens and Ms Bridges both used the term “junior team members” to refer to employees aged under 20 (i.e. excluding 20-year-olds), consistent with the relevant enterprise agreements. In the cited paragraph of her statement Ms Cousens had said: “As a matter of practice, generally Kmart also does not roster junior team members to certain customer-facing duties, including the Service Desk and Customer Greeter positions. These duties involve a high level of direct customer interaction and require the ability to manage more complex enquiries or, in some cases, challenging customer behaviour. The practice does vary across the business. For example, in Tasmania, it is a requirement for the Customer Greeter duties to be performed by a team member who is 494 General Retail Junior Rates (20-year-olds) decision, [171]. 495 Exhibit 109, Statement of Ms Bridges, [47]. 496 Exhibit 109, Statement of Ms Bridges, [53]. 497 The ARA’s closing submissions, [109], relying on Exhibit 109, statement of Ms Bridges, [52], and Exhibit 110, statement of Ms Cousens, [53]. [2026] FWCFB 75 173 at least 18 years old. In all other states and territories, it is determined based on competencies and maturity to perform the duties. Whilst we aim for these duties to be performed by team members above the age of 18, in some instances, team members below the age of 18 may be deemed competent based on the ‘License to Greet’ process.” [639] Reading this passage as a whole, and despite the reference at the outset to “junior team members”, Ms Cousens seems to be saying they do roster young adults and to a lesser extent – subject to competencies and maturity – minors to perform these roles. [640] The ARA referred also to Ms Cousens’ evidence498 that generally team members who are aged 20 and above may be more likely to be rostered onto shifts and undertake work requiring the handling of cash, administrative duties, visual merchandising window changes (usually work that is done during the day) and other supervisory roles, though Ms Cousens added that some junior team members were given supervisory roles, in which case they were paid the adult rate. [641] The ARA said that in the supermarket environment junior employees tended to be rostered on in the service area of a supermarket store or in grocery replenishment.499 It also referred to the restrictions on certain roles for minors which for the reasons explained above we do not consider it necessary to consider. [642] As indicated above MGA argued junior employees were assigned less responsibility. In addition to submitting junior employees are less efficient and made more mistakes, it submitted that junior employees are also less accountable for their work, which also affected the tasks allocated to them. The MGA gave the example of Mr Luchterhand saying that he did not have junior employees making chicken sandwiches because their lack of attention to detail could result in bones being left in, posing health and safety risks to customers.500 Though, for the reasons set out above, we take Mr Luchterhand to be substantially referring here to minors. We do not take him to be indicating that either of the junior employees in his employ as supervisors could not be trusted with food preparation. Ms Koch said an 18-year-old who had been with her business for a couple of years would not be ordering stock, nor be put in charge of a department. They would be a supermarket assistant, and would do the same work as any other supermarket assistant regardless of age, once they had done a couple of years’ work.501 [643] Overall, while the evidence was mixed as to whether junior employees in general were allocated fewer duties or tasks than older employees, it appeared to us that the evidence indicated that the allocation of duties was more responsive to work experience and the qualities of the employee concerned than to age. The conditions under which the work is done [644] As to the conditions under which work is done, the submissions went to the matters we have referred to above. 498 Exhibit 110, Statement of Ms Cousens, [53]. 499 The ARA’s closing submissions, [111], relying on the statement of Ms Bridges, Exhibit 109, [48]. 500 MGA’s outline of submissions, [67]. 501 PN1288-PN1289. [2026] FWCFB 75 174 Assessment of justification for work value reasons [645] For the above reasons, and taking into account subsections 157(2A) and (2B), we do not consider there to be a general differential in work value as between young adults and people aged 21 and over, attributable to age, sufficient to justify paying them differently. We are not here considering whether there has been a change in work value over time, or since a particular point. The broad evaluative exercise involves an assessment of whether work value, connected or associated with the limbs in s 157(2A), justifies varying the award. Having regard to the matters we have considered above, and taking into account the evidence and the parties’ arguments, we are satisfied that making a determination varying modern award minimum wages, in relation to juniors who are young adults, is justified by work value reasons. Our finding as to work value is not of itself sufficient to establish that the variations should be made; there are many other considerations, which we have dealt with below. Fast Food Industry Award [646] We now turn to work value considerations specific to the Fast Food Industry Award. The nature of the work [647] There are many functions within each of the Fast Food Industry Award classifications but the nature of the work is consistent across the classifications regardless of the age of the person performing it. In other words, work involved in the function of assembling burgers or the function of delivering pizzas is work of the same nature regardless of whether the person performing the function is 18 or 21. As with the General Retail Award, the question of whether the junior employees perform a narrower scope of duties or work under different conditions can be dealt with in relation to the other limbs of s 157(2A). [648] The Ai Group submitted502 that it is likely the jobs in question have been designed based on an assumption that they will be performed by young people with little or no experience. It submitted the work is therefore highly routine, task-based work, with high levels of supervision and quality control such that it is capable of being performed by junior employees, notwithstanding their intrinsic differences to adults. As indicated above, the Ai Group’s lay evidence was from witnesses in the fast food industry. The Ai Group relied on the statement of Ms Sharp503 to support this submission albeit it went to training not job design. We observe that the fast food industry is structured around employing minors and young adults. On Prof O’Brien’s evidence, 70% of employees in the retail industry covered by the Fast Food Industry Award were aged under 21. This compared with proportions of around 22% for the other two awards. At the time of his first report almost 45% were minors: 15.4% were 17, 16.1% were 16, and 13.3% were aged under 16.504 Unsurprisingly, in those circumstances, the Fast Food Industry Award is the award under which the highest proportion of employees are paid junior 502 Ai Group’s outline of submissions, [31](a). 503 Exhibit 93, statement of Ms Sharp, [16 ]-[24]. 504 Exhibit 6, O’Brien principal report, [3], [7], [11]. [2026] FWCFB 75 175 rates.505 These demographics support the Ai Group’s submission that jobs in the fast food industry have likely been designed with young people in mind. [649] This submission from the Ai Group, that jobs in junior prevalent work environments are designed to be done by inexperienced young people, seems to us to support a finding of little difference in work value as between even very young employees and persons aged 21 or over. So, the rationale for retaining aged-based differential rates would largely relate to issues other than work value. This is consistent with the Ai Group’s approach to these proceedings, to which we have referred above. The level of skill or responsibility involved in doing the work [650] We now turn to additional consideration of the level of skill and responsibility involved in doing the work, specific to the fast food industry. Amount of training required and time taken to become competent [651] As to competence, we consider the evidence establishes that within six months, and often within substantially less time, employees were competent to perform their roles. [652] Training is sufficiently straightforward in some fast food roles that minors could be appointed as Crew Coaches. Ms Sharp gave evidence as to how McDonald’s considered young workers’ needs and preferences in designing their training.506 The Ai Group said that in a generally low skilled, junior prevalent work environment it was “no surprise to see uniform, fairly basic, standardised, simple and easy to understand training for employees, both in documents and videos, and also on the job shadowing and training.” [653] We acknowledge the investment put into training employees and the benefits that both the employer and the employees obtain from that training. We do not consider it assists us in relation to considering any differentials in work value. Task allocation, range or number of tasks or functions, appointment to positions of responsibility [654] Ms Knight and Mr Zoghbi said that junior employees were allocated fewer tasks.507 The SDA argued that it was “apparent that reason juniors were not performing more tasks because their employer did not allow them to do so.”508 That may be the case but a rational, profit- seeking employer would be unlikely in our view to take such an approach capriciously. [655] We have considered whether tasks are allocated differently to young adults compared with workers aged 21 and over. We do not find that in general workers aged 18 to 20 are 505 Yuen K & Tomlinson J (2023), A profile of employee characteristics across modern awards, Fair Work Commission Research Report 1/2023, March (“Yuen & Tomlinson (2023)”), at 23, 34. A further version of this report was published in February 2025: Strong, J., Rozenbes, D., and Tomlinson, J., A Profile of Employee Characteristics across Modern Awards – 2023, Fair Work Commission Research Report No 1/2025, February 2025. Both the 2023 report and the 2025 report were referred to in the 2025 Annual Wage Review. The parties have not relied on the 2025 report. 506 Exhibit 93, statement of Ms Sharp, [20]-[29]. 507 Zoghbi, PN4061-2, 4084-6; Knight, PN3940-1. 508 SDA’s closing submissions, [128]. [2026] FWCFB 75 176 allocated a narrower range of tasks than workers aged 21 and over. We consider that the evidence as to task allocation indicates that it is contingent on the amount of experience in the business rather than age, such that an 18-year-old who has worked in the business since age 15 would be likely to be expected to perform a broader range of tasks than an 18-year-old who has worked in the business for only a few months. The conditions under which the work is done [656] As to the conditions under which work is done, the submissions went to the matters we have referred to above. Assessment of justification for work value reasons [657] For the above reasons, and taking into account subsections 157(2A) and (2B), we do not consider there to be a general differential in work value as between young adults and people aged 21 and over, attributable to age, sufficient to justify paying them differently. We are not here considering whether there has been a change in work value over time, or since a particular point. The broad evaluative exercise involves an assessment of whether work value, connected or associated with the limbs in subs 157(2A), justifies varying the award. Having regard to the matters we have considered above, and taking into account the evidence and the parties’ arguments, we are satisfied that making a determination varying modern award minimum wages, in relation to junior employees aged 18 and over, in relation to the junior rates provided for by the Fast Food Industry Award, is justified by work value reasons. This is not of itself sufficient to establish that the variations should be made; there are many other considerations, which we have dealt with below. Pharmacy Industry Award [658] We now turn to work value considerations specific to the Pharmacy Industry Award. The nature of the work [659] The Pharmacy Guild submitted that pharmacy is very different to retail and fast food, because they were in the business of health care, and generally considered the people they served to be patients, not customers. The Pharmacy Guild submitted that unlike much of fast food and general retail, where juniors make up a large percentage of the workforce, that was not the case in pharmacy. Juniors were fewer in number, and they were employed to do the low- skilled work to support the primary purpose of the business, which they say is providing medication and health care services to the community.509 [660] It submitted, and we accept, that:510 There are four classification levels for pharmacy assistants in the Pharmacy Industry Award. Juniors, as a result of the variation made during the Modern Award review in 2017 … can only be engaged at classification levels 1 and 2. A level 3 pharmacy 509 PN5130 to PN5134. 510 PN5135. [2026] FWCFB 75 177 assistant is an employee who has acquired the competencies to hold the Certificate III qualification in community pharmacy – that is not a retail qualification; that is a qualification in community pharmacy – and is paid the adult rate for their age. Only employees at level 3 and higher can supervise junior employees. [661] As can be appreciated, the levels relate to qualified and unqualified pharmacy assistants. Movement up to level 2 is contingent on obtaining the relevant qualification. There is no doubt that the junior rates provisions of this award are narrower and more targeted than the junior rates provisions of the other two awards. The latter allow junior rates to be payable to people working at higher levels, whereas the Pharmacy Industry Award does not provide for junior rates for workers in managerial or supervisory roles. The level of skill or responsibility involved in doing the work [662] The SDA submitted:511 The only SDA lay witnesses whose evidence was challenged were the four pharmacy witnesses, who were the subject of very limited cross-examination by the [Pharmacy Guild]. The oral evidence of KM, CM, BC and KP only served to highlight what junior employees are capable of. For example, KM spoke in detail about her role in the dispensary, and her understanding of restricted medications, doctor’s scripts and annotations, liaising with pharmacists, dispensary technicians and doctors, and the precise cost of Ozempic under the Pharmaceutical Benefits Scheme.512 Witnesses called by the Pharmacy Guild also outlined the extensive and complex training that junior pharmacy workers complete. Junior pharmacy workers are certified in the provision of S2 and S3 medications, a process that involves 40 to 50 hours of training.513 This was consistent with the evidence of pharmacy employees called by the SDA. [663] The Pharmacy Guild accepted that an employee at classification level 1 or 2 could be required to perform all of the tasks of that level regardless of their age but maintained that it was still often the case that junior employees at those levels only did some of the tasks. It referred us to the evidence of Mr Zoghbi and Ms Knight in that regard. [664] Having heard the SDA’s lay witnesses, it was clear they were capable and were expected to perform a broad range of duties. Having considered the evidence, we find that the level of skill and responsibility involved in doing the work differed little as between young adults and workers older than them. The conditions under which the work is done [665] In addition to the matters we have referred to above, and as the Pharmacy Guild points out, the conditions under which the work is done include the regulatory environment specific 511 SDA closing submissions, [132]-[133]. 512 KM, PN 989-1017. 513 Knight, PN3909; Zoghbi PN4308. [2026] FWCFB 75 178 to healthcare and pharmacy. We heard evidence of junior employees undertaking training in relation to regulatory requirements. Assessment of justification for work value reasons [666] For the above reasons, and taking into account subsections 157(2A) and (2B), we do not consider there to be a general differential in work value as between young adults and people aged 21 and over, attributable to age, sufficient to justify paying them differently. We are not here considering whether there has been a change in work value over time, or since a particular point. The broad evaluative exercise involves an assessment of whether work value, connected or associated with the limbs in subs 157(2A), justifies varying the award. Having regard to the matters we have considered above, and taking into account the evidence and the parties’ arguments, we are satisfied that making a determination varying modern award minimum wages, in relation to junior employees who are young adults, in relation to the junior rates provided for by the Pharmacy Industry Award, is justified by work value reasons. This is not of itself sufficient to establish that the variations should be made; there are many other considerations, which we have dealt with below. Conclusion on work value [667] We consider that making a determination varying modern award minimum wages, in relation to junior employees aged 18 and over, in relation to the junior rates provided for by each of the three awards, is justified by work value reasons. That is necessary but not sufficient for the variations to be made. [668] We have not made specific findings as to the value of work performed by minors because we have considered it unnecessary to do so in light of our consideration of the modern awards and minimum wages objectives. [669] Having reached that conclusion, we now turn to consideration of the remaining issues. Before dealing directly with the modern awards and minimum wages objectives we will first deal with the issue of how changes to junior rates might affect the employment of young people in the general retail, fast food, and pharmacy industries. Potential employment effects [670] We will consider this issue before considering the modern award objective and the minimum wages objective because employment and labour market considerations were raised as a substantial part, if not the major part, of the rationale for retaining the junior rates in their current form, and because the issue of employment effects is relevant to various limbs of the modern awards and minimum wages objectives, and the objects of the Fair Work Act, including but not necessarily limited to the limbs in s 134(1)(aa), (c), (f), and (h), in s 284(1)(a), (b), and (e), and in s 3 (a). [671] Once we have considered the evidence, research and arguments about employment, and have made some conclusions and observations in that regard, we will turn to the modern awards and minimum wages objectives. We will then consider the relevance of our conclusions as to [2026] FWCFB 75 179 employment effects in the context of our consideration of the modern awards and minimum wages objectives below. [672] The expert evidence went to, inter alia, the question of whether increasing the cost of employing young people would cause less employment of young people (effects on employment) or fewer hours per young employee (effects on hours). The expert evidence dealt with total employment, total youth employment, and youth employment within the general retail, fast food, and pharmacy industries. The expert evidence dealt with relevant theory, empirical research and the literature in that regard, and modelling. [673] The expert evidence went to issues other than total employment, and employment distribution, effects, including firm-level and regional impacts, among other matters. We have taken that evidence into account and have referred to it as appropriate in our consideration of the modern awards and minimum wage objectives below. Overview of the expert evidence as to employment [674] As to theory, Prof Borland provided an explanation of how adjustment in the labour market happens, relevant to the cost of labour and the effect on employment, as follows:514 “There are many possible ways in which an employer and its employees might adjust to an increase in the minimum wage … The initial relevant adjustment is how an increase in the minimum wage rate for the affected type of labour translates into a change in the hourly total cost of that labour to an employer. I use the term 'hourly total cost of labour' to represent the wage paid to employees plus on-costs and other costs associated with hiring and training employees. It is the impact of an increase in the minimum wage on the hourly total cost of labour that ultimately matters for an employer's total costs and for their demand for labour, rather than the change in the minimum wage itself. Three factors are relevant here. First, there are on-costs that may increase with an increase in the minimum wage rate for the type of labour affected. Examples would be employer superannuation contributions or payroll tax which are expressed as a percentage of the wage bill. Second, changes in labour market outcomes that occur as a consequence of the increase in the minimum wage rate, can reduce the cost of labour. An example would be where an increase in the minimum wage rate reduces employee turnover, and hence decreases an employer's hiring and training costs. Third, an employer may take actions that to some degree offset the impact of the increase in the minimum wage rate. Examples would be when an employer reacts to an increase in the minimum wage rate by reducing job amenities or non-wage compensation, or by increasing the productivity of employees in jobs paying the minimum wage. The next relevant adjustment is the impact on an employer's demand for labour, and hence on employment. … An increase in the hourly total cost of labour can affect labour demand via: 514 Exhibit 1, Borland principal report, [14]-[23]. [2026] FWCFB 75 180 (1) A substitution effect, whereby the increased cost of employing the type of labour paid a higher minimum wage relative to the cost of other inputs, causes an employer to substitute away from that labour input. Substitution could be: (i) labour-to-labour, where an employer substitutes the type of labour which has become relatively more expensive with the type of labour that is now relatively less expensive; or (ii) labour-to-capital, where an employer substitutes capital for the type of labour which has become more expensive. (2) A scale effect, whereby the increased cost of labour causes the employer to increase the price of the output which it sells, which lowers demand for that output, and hence causes the employer to decrease demand for inputs used in production, including labour (both the type of labour whose minimum wage rate has increased, and other type of labour). Adjustment in employment will also depend on the nature of competition for the type of labour which receives the increase in minimum wage. … In a highly competitive market, a binding minimum wage, set above the market wage that would otherwise exist, implies that the level of employment will be determined by labour demand, which is the 'short side' of the market. Hence, the employment adjustment to an increase in a binding minimum wage rate depends only on how that increase affects an employer's demand for labour. That is, the size of impact on employment depends on the sum of the substitution and scale effects just described. This overall effect is usually summarised as the own-wage elasticity of demand for labour. In a market where employers have some degree of market power (such as monopsony or oligopsony), in the absence of any minimum wage, it is labour supply conditions that determine the market outcome. It is profit-maximising for employers with market power to use that power to pay wages below the level that would exist in a competitive market. The level of employment will then be determined by labour supply, which is the 'short side' of the market for the case where the wage is below the level in a competitive market. When a binding minimum wage is introduced or increased in a market where employers have market power, it can have three potential effects. First, where the minimum wage is such that the employment outcome is determined by labour supply, the new or higher minimum wage paid will increase labour supply, and hence employment will increase. Effectively, the higher minimum wage restricts the capacity of the employer to use its market power to set wages below the level that would exist in a competitive market. Second, where the minimum wage is such that the employment outcome is determined by labour demand, there is a negative effect on employment, in the same way as described above for the case of a competitive market. Third, where the increase in the minimum wage is such as to shift the employment outcome from being determined by labour supply to being determined by labour demand, the impact on employment depends on the sum of the positive effect on labour supply and negative effect on labour demand. Overall, in a labour market where employers have market power, the impact of an increase in the minimum wage on employment is ambiguous. As Manning writes: [2026] FWCFB 75 181 ' ... higher minimum wages lead to both a decrease in the quantity of labor demanded and a rise in the quantity of labor supplied-with the overall impact on employment depending on which effect is larger. As a result, the impact of an increase in the minimum wage on employment is theoretically ambiguous.' Another relevant adjustment is where the increase in minimum wage rate paid to the type of labour directly affected causes an increase in the wage rate paid to the other type of labour. There are several reasons why such a 'spill-over' might occur … For example, fairness norms may cause an employer to seek to maintain wage relativities between the types of labour; or an increase in demand for the other type of labour, due to labour-to- labour substitution induced by a higher minimum wage, may cause an increase in its market wage. However, the operation of those forces may be limited. If an existing wage structure is considered unfair, and an increase in the minimum wage addresses that unfairness, a spillover effect based on fairness considerations would not be expected. And the extent to which higher demand would increase wages for the other type of labour is likely to depend on the share of that type of labour employed in the industry where the increase in minimum wage occurs. When a spillover in wages does happen, the same adjustment issues arise as for the effect on employees who receive the minimum wage increase…” (citations omitted) [675] Having provided that explanation, Prof Borland opined that the employment (and employment costs) impact of the SDA’s proposals would depend on four key elements:515 • Responsiveness of employers' demand for labour to changes in wage rate/hourly total labour costs. • Degree of competition in the labour market. • Extent to which the per cent increase in hourly total labour costs is the same/more/less than per cent increase in minimum wage rate. • Extent to which the increase in minimum wage for the type of labour directly affected spills over to the other type of labour. Studies [676] We have considered the studies and other research provided in relation to: • the employment effects of changes to youth rates; • the employment effects of step increases in youth rates according to age (referred to as “the birthday studies”); • the employment effects of minimum wages generally; and • Australian studies. 515 Exhibit 1, Borland principal report, [24]. [2026] FWCFB 75 182 Studies regarding changes to youth rates [677] The parties’ experts referred us to various studies. Some of the studies went to empirical research in relation to the consequences of minimum wage changes in various places. We will refer to some of them here. [678] Prof Borland said he was not aware of any Australian literature directly relevant to the employment effects of an increase in the youth minimum wage. He referred to international studies that related to youth-specific minima. New Zealand [679] Prior to 1994, New Zealand’s minimum wage legislation applied only to workers aged 20 and older. A youth minimum was introduced in 1994 for 16-to-19-year-olds, set at 60 per cent of the adult rate.516 In the 2000s there were major reforms. The first commenced in 2001, and was as follows:517 • in 2001, eligibility for the youth minimum was changed from 16-19 years to 16-17 years; • the youth rate was increased from 60 to 70 percent of the adult rate in 2001, and from 70 to 80 percent in 2002; [680] Then, in a further reform in 2008, the youth rate for employees aged 16-17 years was abolished. The adult minimum applied to all workers aged 16 or older. At the same time, a “New Entrant” wage was introduced, set at 80% of the adult minimum, for 16- to 17-year-olds who were newly employed (covering their first 200 hours or 3 months of cumulative employment).518 [681] In 2013, the New Entrant wage was replaced by a “Starting Out” wage of 80% of the adult minimum, for:519 • 16-17 year-olds in the first 6 months of employment with their current employer; • 16-19 year-olds undertaking at least 40 credits of industry training; and • 18-19 year-olds in their first 6 months of employment with an employer following at least 6 months on a main welfare benefit. [682] Dr Hyslop noted that these youth minimum wage reforms occurred against a backdrop of relatively strong increases in the adult minimum wage. He said that between 2000 and 2008, the adult minimum was increased at about twice the rate of inflation, and by about 30% in inflation-adjusted terms over that period.520 516 Exhibit 84, Hyslop principal report, [7]. 517 Exhibit 84, Hyslop principal report, [8]. 518 Exhibit 84, Hyslop principal report, [9]. 519 Exhibit 84, Hyslop principal report, [10]. 520 Exhibit 84, Hyslop principal report, [11]. [2026] FWCFB 75 183 [683] These changes applied to all workers of the relevant ages, as opposed to the application in these proceedings which relates only to employees covered by the three awards. Prof Borland summarised the literature in relation to the New Zealand changes as follows:521 • Studies that focus specifically on the 2001 and 2008 increases in youth rates find extremely small or zero effects on employment of workers aged 16-17 years and 18-19 years. There is mixed evidence on the impact on average hours worked, and hence on average weekly earnings. There is some evidence of substitution between youth workers (for example, from workers aged 16-17 years to workers aged 18-19 years in 2008 when the youth minimum wage was abolished for workers aged 16-17 years). • Analysis of the impact on youth employment from minimum wage increases over the whole of the 2000s and 2010s (which incorporates the 2001 and 2008 policy changes) finds a somewhat larger negative effect of wage increases on employment of workers aged 16-17 years, but no effect on employment of workers aged 18-19 years. • The negative impact on employment of youth workers from an increase in the youth minimum wage rate is found to be larger where: (i) Macroeconomic conditions are more adverse; and (ii) A firm’s workforce has a larger proportion of youth workers. • The main method of adjustment to an increase in youth rates was for firms to reduce their hiring of youth workers, rather than laying off workers. [684] Professor Lewis referred to a study co-authored by Dr Hyslop as to the effect of these reforms. [685] Dr Hyslop told us that though research found no statistically significant evidence of employment loss within the first two years of the 2001 New Zealand reforms and only weak evidence of employment loss two years later, more consistent evidence had been found of an increase in weekly hours worked by teenage workers following the reform, particularly 16- to 17-year-olds.522 [686] Research on the effects of the 2008 reform found it reduced the employment rate of 16- 17 year-olds by 3–6 percentage points (7–15%) over the following 2-3 years,523 but had no immediate effect.524 Dr Hyslop told us525 that robust research design options for the 2008 reform were arguably more limited than for the 2001 reforms for various reasons, including: (i) the directly affected group (16-17 year-olds) was smaller; (ii) the most natural comparison group (18-19s) was potentially indirectly affected by any spillover effects from firm-substitution away from 16-17s employment; (iii) the relatively strong increase in the adult minimum wage may have been adversely affecting the outcomes of teen and young adults separately from the youth reform; (iv) given the introduction of the ‘New Entrants’ minimum wage for 16-17 year-olds, the adult minimum wage may be less binding; and 521 Exhibit 1, Borland principal report [39] (drawing on Mare and Hyslop, 2021; Hyslop and Stillman, 2007, 2021; Hyslop et al., 2012; Eckert et al., 2018; and van der Westhuizen, 2022). 522 Exhibit 84, Hyslop principal report, [14]-[15]. 523 Exhibit 84, Hyslop principal report, [2]. 524 Exhibit 84, Hyslop principal report [19]. 525 Exhibit 84, Hyslop principal report, [17]. [2026] FWCFB 75 184 (v) the reform came into effect at the start of a domestic recession (which was confounded by the Global Financial Crisis in 2008), which potentially affected the comparability of young adults’ labour market outcomes. [687] In light of those limitations articulated by Dr Hyslop, given his familiarity with the subject as one of the leading writers on it, we would be cautious about relying too heavily on the research in relation to the 2008 reforms. Dr Hyslop expressed the view that because there were different trends in employment of 16- to 17-year-olds compared to older age groups, that suggested the drop in 16- to 17-year-olds’ employment was due to minimum wage effects, not only the business cycle. Prof Borland said that in Australia there had been a decline in employment for people aged 15 to 19, but growth in employment for people aged 20 to 64, at the same time, without there being any commensurate youth wage reform.526 Portugal [688] In 1987, the age-specific minimum wage for employees aged 17 years in Portugal increased from 50 to 75 per cent of the adult minimum wage. The rate for employees aged 18- 19 years increased from 75 to 100 per cent. Prof Borland said the initial study by Pereira (published 2003)527 had found a negative impact on employment, whereas a later study by Portugal and Cardoso (published 2006)528 found a positive impact, mainly explained by a decrease in the rate of separation from existing employers by young workers following the minimum wage increase. He pointed out the latter indicated they had been unable to reproduce the former’s analysis. Prof Lewis’ view was that the Portugal and Cardoso (2006) study had found that the effect on teenagers of a rising minimum wage was a reduction of teenagers entering employment but also a reduction of teenagers leaving their jobs, “somewhat neutralising the reduction due to higher relative wages.”529 Canada [689] Between 1986 and 1998, youth rates (applicable to workers under 18) were abolished in six out of ten Canadian provinces. The differences between the youth and adult rates had ranged from 3 to 13 per cent. [690] Prof Borland said, in relation to the studies arising from these changes, that Shannon (2011)530 had found a consistent negative effect on employment across affected provinces from abolishing the age-specific minimum wage. He said that, however, an important caveat was that the method used by Shannon, known as 'staggered difference-in-difference' was now understood to give potentially biased causal estimates when implemented using the empirical method in Shannon's study (Roth et al., 2023).531 Prof Lewis also referred to this study noting that the author’s opinion had been that results had provided some evidence that abolishing youth 526 Exhibit 3, Borland reply report, [46]. 527 Pereira, Sonia (2003), 'The impact of minimum wages on youth employment in Portugal', European Economic Review, 47, 229-44. 528 Portugal, Pedro and Ana Rute Cardoso (2006), 'Disentangling the minimum wage puzzle: An analysis of worker accessions and separations', Journal of the European Economic Association, 4( 5): 988-1013. 529 Exhibit 77, Lewis report, [91]. 530 Shannon, Michael (2011), 'The employment effects of lower minimum wage rates for young workers: Canadian evidence', Industrial Relations, 50( 4): 629-55. 531 Roth, Jonathan, Pedro HC SantAnna, Alyssa Bilinski and John Poe (2023), 'What's trending in difference-in-differences? A synthesis of the recent econometrics literature', Journal of Econometrics, 235(2): 2218-44. [2026] FWCFB 75 185 rates significantly lowered employment and work hours of 15- to 16-year-olds, while expressing some doubts about the interpretation of the results and the lack of evidence for some jurisdictions.532 Netherlands [691] In 2017, the age for adult rates was lowered from age 23 to age 21 in the Netherlands. The youth rates for workers aged 18 and over were increased. Prof Borland said that in their study van Bezooijen et al. (2024)533 found a positive impact on total hours worked. Dr Hyslop noted that van Bezooijen et al had found no adverse effects on youth employment.534 Prof Lewis referred to an earlier study, from 2020,535 which found minimal negative effects. He expressed doubt about the relevance of this study for our present purposes given the different age cohorts.536 Belgium [692] Prof Lewis alerted us to a reform in Belgium, saying that between April 2013 and January 2015, the Belgian government had phased out youth sub-minimum rates for workers aged 18 to 20, resulting in wage increases of 6 percent for 20-year-olds, 12 percent for 19-year- olds, and 18 percent for 18-year-olds. The sub-minimum youth rates had been reintroduced in 2019. We were not taken to any studies as to the effects of these changes, if any, on employment. In the absence of evidence as to employment effects, we do not consider this example assists us and we do not infer anything from the subsequent policy change. What can be drawn from studies of youth rates changes [693] Having considered the studies regarding New Zealand, Portugal, Canada and the Netherlands, Prof Borland said537 that in his opinion the main conclusions that it is appropriate to draw from these studies are that: “(i) All studies find a relatively small responsiveness of employment to wages; and (ii) The evidence for positive effects is more strongly based than for negative effects.” [694] Professor Lewis’s opinion was:538 “…that the international cases above are so different to that proposed for Australia and the mixed findings on the impacts of reducing, abolishing or restructuring youth wages, are such that they offer little help in estimating the effect of changes to junior awards in Australia.” 532 Exhibit 77, Lewis report, [92]. 533 Van Bezooijen, Emiel, Wiljan Van Den Berge and Anna Salomons (2024), 'The young bunch: Youth minimum wages and labor market outcomes', Industrial and Labor Relations Review, 77(3): 428-60. 534 Exhibit 84, Hyslop principal report, [31]. 535 Dutch Ministry of Social Affairs and Employment (SIZW, 2020). 536 Exhibit 77, Lewis report, [93]. 537 Exhibit 1, Borland principal report, [42]. 538 Exhibit 77, Lewis report, [94]. [2026] FWCFB 75 186 Birthday studies [695] The experts referred us to “birthday studies” which is to say studies about the effect on employment of having a change in minimum wages according to an employee’s age. Prof Borland did not consider these studies to be relevant to understanding the impact of an increase in junior rates as proposed by the SDA.539 In contrast Prof Holden did consider them relevant.540 Olssen – Australia [696] Dr Hyslop referred us to a 2011 Australian paper by Olssen, who found no evidence that changes in the minimum youth awards as workers age had any effect on youth employment. The Olssen paper was a conference paper for the New Zealand Association of Economists Annual Conference in Wellington. It also does not find any evidence that the increasing youth minima affected hours worked. However, as the version of the paper to which we were referred is not peer-reviewed, we have treated it with caution. Kabátek – the Netherlands [697] Dr Hyslop said that, in contrast, Kabátek (in a 2021 study)541 had found negative employment effects associated with the step increases in youth rates in the Netherlands. Dr Hyslop said, however, that it was not clear whether this reflected standard adverse employment effects in response to higher minimum wages, or some steady-state behaviour of employers substituting similar workers who were subject to different minimum wages across the youth rate ladder. The Kabátek study concluded that:542 “The aggregate job separation probability increases by 0.6 to 1.5% in the three months closest to workers’ birthdays, compared to the rest of the year. The effect exhibits substantial heterogeneity, with its size being dependent on a worker’s age, phase of the business cycle, and sector of employment. The supermarket sector in particular is shown to be responsive to the discontinuities, with the aggregate job separation probability increasing by 2%, compared to the 0.9% increase applicable for the other sectors. … The incidence of job accessions is shown to increase after workers reach the birthday discontinuities. Compared to the preceding spike of job separations, the higher rate of job accessions is sustained throughout the months that follow workers’ birthdays. This dependence results in a dynamic effect on the overall level of employment: The employment rate is initially subject to a level drop of 0.3 percentage points caused by the spike of job separations. This drop is compensated by a higher growth rate of employment in the following months and the cumulative effect becomes positive six months past the birthday discontinuities. Importantly, the positive cumulative effect means that the increase of job accessions cannot be fully attributed to the re-employment of workers who were initially dismissed due to the minimum wage discontinuities. The sustained profile of the job accession effect is suggestive of post-birthday entry of 539 Exhibit 1, Borland principal report, [44]. 540 PN1956. 541 Kabátek, Jan. (2021). Happy Birthday, You’re Fired! Effects of an Age-Dependent Minimum Wage on Youth Employment Flows In The Netherlands, ILR Review, Vol. 74, No. 4 (August 2021), pp. 1008-1035. 542 Ibid, 1032-1033. [2026] FWCFB 75 187 workers with higher reservation wages, or selective hiring behavior of firms who are looking for job applicants of a particular calendar age.” [698] In the abstract the author had summed up these effects as follows:543 “The job separations spike in the three months that precede workers’ birthdays, suggesting that firms are dismissing workers whose costs are about to go up. The frequency of job accessions increases immediately after the birthdays and the increase is sustained throughout the following months. The resulting effect on employment levels is dynamic, with the employment rate being subject to an initial drop that is gradually compensated for by the higher rates of post-birthday labor market entry.” [699] Though these findings are of interest the author cautioned against using this study to analyse what would happen if alternatives such as replacing youth wages with adult wages were to be introduced:544 “The results of my analysis show that employers and employees alike are responsive to minimum wages, resulting in a complex pattern of labor market flows surrounding the minimum wage discontinuities. I should add, however, that although the presented results help us understand the labor market dynamics within the age-dependent minimum wage systems, they are not particularly suited for evaluation of counterfactual scenarios that would fundamentally change the design of the age-dependent systems— an example being a reform replacing the youth subminimum wage rates by the adult rate. In such a case, the job separation effects would be moderated by the fact that employers could no longer replace their current employees with a cheaper substitute workforce (although a large enough change might motivate firms to switch to less labor- intensive modes of operation, thereby eliminating the need for minimum wage labor altogether). The job accession effects would be also moderated, since the mechanical re-employment effect following the initial increase of job separations would be eliminated in the first few months following the implementation of the reform. An evaluation of such counterfactual simulations needs an alternative research design, preferably one that exploits a reform of an age-dependent minimum wage system, such as the recent introduction of a national living wage for workers aged 25 and above in the United Kingdom.” Kreiner et al – Denmark [700] Prof Holden referred us to a 2018 study by Kreiner et al545 which studied the effects of a jump in the hourly wage, by 40%, at age 18, in Denmark. In this paper, Kreiner et al found a 15 percentage point decrease in employment at age 18, from over 50% to under 40%. This corresponded to a 33 percent decrease in the number of employed individuals and that employment took two years to return to the same level.546 This study related to age-based rates 543 Ibid, 1008. 544 Ibid, 1033. 545 Kreiner, Claus Thustrup, Reck, Daniel, and Skov, Peer Ebbesen. (2018). Do lower minimum wages for younger workers raise their employment? Evidence from a Danish discontinuity. CEBI Working Paper Series, Working Paper 05/18. August 2018. (“Kreiner et al, 2018”), in Exhibit 81, Prof Holden’s bundle of sources. 546 Kreiner et al, 2018, 2-3. [2026] FWCFB 75 188 across the whole economy, not in particular industries,547 and there was no change at any age other than 18. The study’s authors pointed out there may be cross-age substitution, so the employment elasticity would likely be higher than if there was a global minimum wage change.548 They also considered there was heterogenous productivity among 18-year-olds, explaining why two thirds of 18-year-olds remained employed despite the sharp increase in hourly rates.549 As the ARA submitted, Professor Holden considered this study based on an ideal setting in which to study the impact of removing youth minimum wages because it did not rely on a specific episode but was an ongoing component of the wage system. Prof Holden indicated this study showed that employment falls by 33% where a youth minimum wage is increased by 40% at the age of 18, implying an elasticity of - 0.83.550 Professor Holden’s view was that the Kreiner study was looking at the causal effect of a change to youth rates, which he said was precisely the issue in the proceeding.551 Professor Holden opined that one of the advantages of a study in Denmark is that that country shares many features in common with the Australian economy.552 As stated above Prof Borland did not consider these birthday studies relevant. Nonetheless he said this study was not entirely uninformative.553 [701] While referring us to international literature the experts nonetheless suggested caution as to its use. For example, Prof Holden said:554 “… when one starts comparing across jurisdictions or across timeframes there are many other things going on and so it's quite hard to draw too many conclusions from that. There obviously are many characteristics to the Danish labour market, social safety net, norms and social conventions that differ from other jurisdictions and it's hard to tease out the effect of that on some of these aggregate variables.” Minimum wage studies [702] There are various international studies as to the employment effects of introducing or increasing minimum wages generally (as opposed to junior rates). Prof Borland said:555 “There is a vast (and ever-growing) literature on the impact of changes to the minimum wage on employment. A major lesson from this literature is that the size of impact depends on the specific circumstances of the change to the minimum wage rate – such as the extent of competition in the labour market for the workers who receive an increase in minimum wage; the size of increase in and / or pre-existing level of the minimum wage; whether the increase is one-off or part of a regular cycle; whether the increase applies to a subset of employees or all employees; characteristics of the employees affected; and the time horizon over which the impact is analysed. 547 PN1926. 548 PN1941 and following. 549 Kreiner et al, 2018, 8. 550 Exhibit 80, Holden report, [86]. 551 PN1956. 552 PN2133. 553 PN176, PN536 (Borland cross-examination). See also Exhibit 2, Borland supplementary report, [40]-[41], [48]. 554 PN2090. 555 Exhibit 1, Borland principal report, [35] to [36]. [2026] FWCFB 75 189 This suggests that in evaluating the likely impact of the proposed changes to minimum junior wage rates, the most valuable evidence will be from similar episodes - where there is a one-off increase in minimum wage for a group of young workers for a relatively large proportion of whom the increase will directly cause an increase in wages paid. …” [703] The expert witnesses referred to the international literature. The Ai Group also provided, in a bundle of research reports that it tendered,556 a paper on the employment effects of a significant increase in California’s statewide fast food minimum wage in 2024.557 This was not a youth-specific minimum wage. The SDA provided a further bundle of four research reports regarding the California example, in response.558 Ai Group also tendered a research report that Prof Lewis had referred to in his written evidence,559 and an extract from an AIHW report.560 The SDA tendered a later, published version of the same research report which differed from the version the Ai Group had tendered.561 The ARA tendered a volume of the 556 Exhibit 105, Australian Institute of Health and Welfare (2021) Australia’s youth: Engagement in education or employment, AIHR, Australian Government, accessed 2 July 2025. Australian Institute of Health and Welfare (2021) Australia’s youth, AIHR, Australian Government, accessed 2 July 2025. Anlezark, A., & Lim, P. (2011). Does Combining School and Work Affect School and Post-School Outcomes? Longitudinal Surveys of Australian Youth. NCVER. Australian Institute of Health and Welfare (2021) Income support for young people, AIHR, Australian Government, accessed 7 July 2025. Jobs and Skills Australia (2025) Employers’ experiences of young job applicants: Findings from the Recruitment Experiences and Outlook Survey, Australian Government. Did California's fast food Minimum Wage Reduce Employment?’ by Jeffrey Clemens, Olivia Edwards, and Jonathan Meer NBER Working Paper No. 34033 July 2025. 557 ‘Did California's fast food Minimum Wage Reduce Employment?’ by Jeffrey Clemens, Olivia Edwards, and Jonathan Meer NBER Working Paper No. 34033 July 2025, in Exhibit 105 (bundle of reports). 558 Exhibit 76, Denis Sosinskiy and Michael Reich, ‘A $20 Minimum Wage: Effects on Wages, Employment and Prices’, (University of California, Berkeley, September 2025). Daniel Schneider and Kristen Harknett, ‘Early Effects of California’s $20 fast food Minimum Wage’, (Harvard Kennedy School Malcolm Wiener Center for Social Policy & University of California, San Francisco, October 2024). Naser Hamdi and David Sovich, ‘The Wage and Employment Effects of California’s Fast-Food Minimum Wage’, (April 2025). Jeffrey Clemens, Olivia Edwards and Jonathan Meer, ‘Did California’s fast food Minimum Wage Reduce Employment?’, (Working Paper 34033, National Bureau of Economic Research (NBER), July 2025. 559 Exhibit 78, David Neumark, J.M. Ian Salas, and William Wascher, ‘Revisiting the Minimum Wage Employment Debate: Throwing out the baby with the Bathwater?’, (Working Paper 18681, National Bureau of Economic Research (NBER), January 2013). 560 Exhibit 107, Australian Institute of Health & Welfare (2023), ‘Australia’s Welfare 2023 Data Insights’, Chapter 7, catalogue number AUS 246, AIHW, Australian Government. 561 Exhibit 79, David Neumark, J.M. Ian Salas, and William Wascher, ‘Revisiting the Minimum Wage Employment Debate: Throwing out the baby with the Bathwater?’, (2014), 67 (Supplement) 2014 ILReview, 608. [2026] FWCFB 75 190 sources Prof Holden had cited in his report.562 The SDA tendered a 2022 report by Neumark and Shirley,563 and a 2006 report by Neumark and Wascher.564 [704] Despite the amount of literature put before us, the SDA submitted that the questions put to the expert witnesses in cross-examination suggested that the employer parties considered these minimum wage studies to be barely relevant.565 The expert witnesses themselves appeared to be of the view that we could not derive much assistance from the general minimum wage studies. Prof Borland considered studies regarding minimum wage changes targeted at youth workers to be more relevant than studies regarding minimum wages generally, saying:566 “The essential point regarding relevance is that this type of increase potentially generates a different adjustment process than for other types of increases to minimum wage rates. For example, consider labour-to-labour substitution. For an increase in the minimum wage that applies to all workers (such as Australia’s National Minimum Wage) the scope for substitution is restricted to replacing workers paid at the minimum wage with more skilled workers earning above the minimum wage. Whereas a change to youth rates potentially allows substitution to other groups of workers earning different age-related minima. That is, an increase in the minimum wage rate for an age group could generate substitution towards workers in a younger or older age group (whose minimum wage rate had not been adjusted), as well as towards more skilled workers in the same age group.” [705] Prof Lewis considered the literature regarding the minimum wage for fast food workers in California to be largely irrelevant, on the basis that the results applied to what happens when you change the whole of a minimum wage for one particular industry compared to the rest of 562 Exhibit 81, a bundle of 21 sources , Australian Bureau of Statistics, Australian Industry, 2022; Australian Bureau of Statistics, Census 2021; Australia Bureau of Statistics, Australian National Accounts, June 2024; Australian Bureau of Statistics, Wage Price Index, Australia methodology, March 2025; Clemens, Jeffrey (2021) How do firms respond to minimum wage increases; Collins Foods 2024 Annual Report; Dube, Arindrajit and Attila S. Linder (2024). “Minimum Wages in the 21st Century,” Eckert_Poster.pdf; Hurst, Erik, Patrick Kehoe, Elena Pastorino, and Thomas Winberry (2025). “The Macroeconomic Dynamics of Labor Market Policies,”; Hyslop, Dean and Steven Stillman (2007). “Youth minimum wage reform and the labour market in New Zealand,” Labour Economics 14 201; Hyslop, Dean and Steven Stillman (2021) The impact of the 2008 minimum wage reform in New Zealand; Hyslop, Dean R., David C. Maré, Steven Stillman, and Jason Timmins. 2012. “Heterogeneous Firm Responses to Rising Teenage Wages.” Labour; Kreiner, Claus Thustrup, Reck, Daniel and Ebbesen Skov. Peer (2020), ‘Do lower minimum wages for young workers raise their employment E; Leigh, A. (2003). Employment effects of minimum wages Evidence from a quasi experiment. Australian Economic Review, 36(4), 361; Mare, David and Dean Hyslop (2021) Minimum wages in New Zealand Policy and practice in the 21st century; Neumark, David (2018) The Econometrics and Economics of the Employment Effects of Minimum Wages; Portugal, Pedro and Ana Rute Cardoso (2006). “Disentangling the Minimum Wage Puzzle An Analysis of Worker Associations; Roth, Jonathan, Pedro HC Sant’Anna, Alyssa Bilinski, and John Poe (2003) What's trending in difference; Shannon, Michael, (2011) The Employment Effects of Lower Minimum Wage Rates for Young Workers; van der Westhuizen, De Wet (2022) Effect of minimum wage increases on teenage employment Survey and administrative data; and von Wachter, Till (2020) The Persistent of Effects of Initial Labor Market conditions for Young Adults and their Sources. 563 Exhibit 82. Neumark, David & Shirley, Peter. (2022). Myth or measurement: What does the new minimum wage research say about minimum wages and job loss in the United States?. Industrial Relations: A Journal of Economy and Society. 61. 564 Exhibit 83. Neumark, David & Wascher, William. (2006). Minimum Wages and Employment: A Review of Evidence from the New Minimum Wage Research. NBER Working Paper 12663, November 2006. 565 PN4631. 566 Exhibit 3, Borland reply report, [37]. [2026] FWCFB 75 191 the economy, whereas in this case the issue is what would happen when you change the rates of pay for different age groups within an industry.567 Prof Holden considered that minimum wage studies may be informative but youth wage studies were better, conditional on their quality.568 [706] The application does not seek to change minimum rates consistently and comprehensively across the economy or across each industry. Even in the fast food industry where a substantial proportion of the workforce is aged under 21 there would not be a uniform increase across all age levels. Also, most of the studies are international and relate to data collected under different economic and regulatory conditions. We accept that the general minimum wage studies provide us with little assistance. Australian studies [707] We have referred to the Australian birthday study, by Olssen, above. [708] Prof Borland referred to Australian studies from the 1970s and 1980s that he did not consider to be relevant. Prof Lewis referred to Australian studies from the 1980s that he said provided strong support for the view that the demand for youth labour was negatively related to junior wage costs relative to adult workers.569 He said the results were strong and had not been overturned by researchers. Leigh [709] Dr Hyslop referred to a study by Dr Leigh from 2003 in which the latter had analysed the effects of minimum wage increases on employment from six policy changes in Western Australia between 1994 and 2001, using a difference-in-differences approach with aggregate state-level data. Prof Borland said the Leigh study had considered the particular effect on 15- to 24-year-olds of a statewide increase.570 Dr Hyslop said Dr Leigh had estimated an overall employment elasticity of - 0.13 averaged across the six changes, and an average elasticity of - 0.39 for youth workers (aged 15-24). Dr Hyslop noted that the study had been critiqued.571 Prof Lewis referred to Australian studies from the 1980s that he said provided strong support for the view that the demand for youth labour was negatively related to junior wage costs relative to adult workers.572 He said the results were strong and had not been overturned by researchers. [710] Though the experts considered the Leigh study to have been a major advance in the literature on minimum wages at the time it was published,573 there was considerable contest between the parties as to its usefulness in this case. These arose both from the nature of the 567 PN1434. 568 PN1920. 569 Exhibit 77, Lewis report, [96]. Professor Lewis’s list of references also included the 1998 Productivity Commission staff research paper to which ACCI had referred us, Productivity Commission, Staff Research Paper, ‘Youth wages and Employment’ (1998). 570 PN156. 571 Exhibit 84, Hyslop principal report, [29]. 572 Exhibit 77, Lewis report, [96]. 573 Prof Borland, PN153. [2026] FWCFB 75 192 study, in that it related to increases in the minimum wage generally rather than to youth wages, and in relation to criticisms of the study. The SDA submitted the elasticity estimate from this study should be treated with great caution. They made this submission on the basis that Dr Leigh had subsequently revised his elasticity estimate to 1.009, the fact that the study related to minimum wages generally and not junior rates, and there was a near consensus that such studies were not relevant, it relied on the 15 to 24 age group which was broader than the age group under consideration in this case, it did not allow for labour-to-labour substitution because of its nature as a minimum wage study, and because the results had been repeatedly critiqued. The criticisms had included that the elasticities had been derived by comparing Western Australia with the rest of Australia despite differing economic trends. 574 We heard that leading academics in the field of employment impacts of minimum wages, Neumark and Wascher, had said in 2006 that the magnitude of the estimates in the Leigh study might be regarded sceptically.575 [711] On the other hand, the ARA referred us576 to Prof Holden’s views as to why the Leigh study should be taken into account. Professor Holden considered that the Leigh study was particularly important in terms of the external validity for this case because it looked at the 15- to 24-year-old cohort in an Australian context.577 As to the erratum that was later issued in respect of the Leigh study, Professor Holden had explained that reasonable minds could differ about whether the original report or erratum was more accurate and explained that he considered the original was more relied upon in the academic literature and in the Australian context.578 Prof Holden had explained why he did not put great weight on the criticisms of the Leigh study by Prof Ian Watson579 and why he considered the Leigh study to be the best evidence of which he was aware in Australia.580 The ARA referred us to a footnote in the Neumark and Wascher paper regarding Prof Watson’s criticisms and Dr Leigh’s reply.581 The ARA also cross- examined Prof Borland as to the Leigh study.582 In the course of doing so they took Prof Borland to a paper he had written in 2018 that had referred to the study and Prof Watson’s criticism of it.583 The ARA submitted that Professor Borland had accepted that the study considered the particular effect of increases in minimum wages in Western Australia on 15-24 year olds.584 It said he also gave evidence that, consistent with evidence he had given in a report to the Fair Work Commission in 2018, that at the time, the study was considered “an important study"585 and, as we have noted above, “a major advance in the literature on minimum wages”586 because no-one had previously tried to do a proper study that focused on a change in minimum wages and made a comparison with a control group. Professor Borland had agreed with Dr Leigh’s 574 PN4646-49. 575 Exhibit 83, Neumark and Wascher 2006 p 90, referred to in O’Brien reply report, [59], and at PN1877 and following. 576 ARA’s closing submissions, [19] to [21]. 577 PN2128 Holden cross-examination 578 PN 1811-1848 (Holden cross-examination). 579 PN1874, Holden cross-examination 580 PN1865. 581 Exhibit 83, fn 93. 582 PN477 and following. 583 Exhibit 5, Research report 4/2018: A review of methods applied in international research on the employment effects of the minimum wage and implication for Australian research, Prof Jeff Borland, February 2018. 584 PN156 (Borland cross-examination). 585 PN525. 586 PN441 (Borland cross-examination). [2026] FWCFB 75 193 methodology but considered it was of limited relevance because of the macro conditions in Western Australia at that time.587 Professor Borland also accepted that in critiquing the control group used in the Leigh study, Prof Watson had not provided any evidence to support his claim.588 [712] The ARA also referred us to Professor Borland’s statement, under cross-examination,589 that he stood by his previous description of the Leigh study in the report to the Fair Work Commission, which provided:590 “Overall, it needs to be said that, while there are limitations with Leigh’s study, these were shared by international studies using the geographic method that were being done at the same time; and the shift to using a geographic method was a major advance for Australian research, providing as it did a potentially stronger basis than the time-series method for identifying groups of workers affected and not affected by changes to the minimum wage.” [713] We accept that the Leigh study had been a major advance at the time it was published. We accept that it has been criticised and that Neumark and Wascher had expressed some scepticism about the results. We accept the elasticities found in the study and the erratum are outliers compared with minimum wage literature having regard to Prof Borland’s evidence as to the narrowing that has occurred over the past few decades. As with all of the general minimum wage studies, we accept that the study was about a different type of change to the change under consideration here. Bishop [714] We also heard of another Australian study as to the impact of minimum wage changes on employment, specifically a 2018 study by Bishop, published in a Reserve Bank of Australia discussion paper.591 Professor Borland described this as “the study that’s recognised as the best study done in Australia”592 in relation to the effect of changes to minimum wages and said that it found no effect on hours worked as a consequence of changes to minimum wages.593 However, he considered studies as to increases in minimum wages generally to be of limited relevance. Prof Holden had not addressed the Bishop study in his written evidence. Under cross- examination he said that Bishop had not found a statistically significant result, that the Bishop paper was inconclusive, and that the Leigh study was the best evidence of which he was aware in relation to this issue in Australia. 587 PN443-445 (Borland cross-examination). 588 PN507 (Borland cross-examination). 589 PN525. 590 Exhibit 5, Borland, Research Report 4/2018: A review of methods applied in international research on the employment effects of the minimum wage and implication for Australian research, p. 7. 591 Exhibit 4, Research Discussion Paper – Effect on Minimum Wage Increases on Wages, Hours Worked and Job Loss, James Bishop, Reserve Bank of Australia, 2018. 592 PN455. 593 PN375–76. [2026] FWCFB 75 194 [715] As both the Leigh and Bishop studies related to changes to minimum wages generally, and as the experts took the view that minimum wage studies were of little or at least less relevance to us, neither of those studies is of significant assistance to us in this case. Effect on demand for labour – evidence as to employment elasticities [716] We accept that assessing likely employment impacts is not confined to applying elasticities of demand for labour to percentage increases in rates. The obvious shortcoming of modelling in this manner is that it assumes all else is held equal which is rarely, if ever, the case in practice. The Applicant cautioned us that Prof Borland had observed that the employment effect from a wage increase would be driven by the size of the impact on employers’ costs. So, fixation on elasticities was apt to mislead.594 We accept that the reality is more complex than taking an average of employment elasticities from the academic literature. We accept that impacts on costs, and how such impacts are managed, will vary. Nonetheless, we consider it useful to consider the expert evidence as to what research can tell us, if anything, in relation to potential employment effects. [717] The experts canvassed the literature regarding the effects of changes in minima (whether general or youth) on employment. We received evidence as to the elasticity of employment with respect to the minimum wage, including evidence as to recent adjustments of the concept by Dube and co-authors, to focus on own-wage elasticity (OWE) of employment with respect to the minimum wage,595 to account for the relative ‘bite’ of the minimum wage in question. These matters went to the number of persons employed, not the hours worked.596 [718] Prof Borland said that over the past thirty-five years differences in views between economists as to the employment effects of the minimum wage had narrowed. He referred us to the Card and Kruger fast food study in which a particular minimum wage increase had had a positive effect on employment, as well as to the Neumark and Wascher body of work which had found a significant negative effect with an employment elasticity between - 0.3 to - 0.5. He made the point that 35 years ago there had been a significant disagreement as to employment effects in the minimum wage literature but in the time since it had ‘really narrowed down.’ He referred to Dube and Lindner’s work with an estimate of around - 0.1, and Neumark and Wascher’s more recent work, with estimates between - 0.13 and - 0.15. As to the literature more broadly he considered the range to be in the vicinity of very small effects of - 0.03 up to the high (minus ) 0.1s.597 Prof Borland said598 “based on the best knowledge at the moment, I don't think there is a lot of disagreement about what the elasticity is, the wage elasticity, in response to minimum wage changes.” His view was that an elasticity of - 0.3 was “out of the ballpark now”.599 [719] As indicated above, Prof Borland considered that many of the studies in the minimum wage literature related to minimum wage increases applying across the workforce. He 594 PN4628. 595 Exhibit 84, Hyslop principal report, [28]. 596 Cross-examination of Prof Borland, PN287 597 PN146. 598 PN144. 599 PN 146. [2026] FWCFB 75 195 considered that such literature was not the most valuable for considering the impact of the changes proposed in these proceedings, for reasons related to relevance and statistical credibility.600 He agreed that:601 • when comparing any of the elasticities drawn from any particular study, and seeking to apply them to an estimate of this particular circumstance, it's only as good as the comparison that one makes, in terms of the particular facts and circumstances inherent in the change; and • one has to take account of the quality of the methodologies used in any of the particular reports before placing particular weight on that report. [720] Prof Borland also said there was “consistent evidence that in labour markets with higher degrees of employer concentration, where employers are hence likely to have greater market power, employment impacts of minimum wage increases are less negative or even positive.”602 This was relevant where monopsony power enabled employers to pay a lower wage than the equilibrium wage that would exist in a perfectly competitive market.603 Prof Borland said that if there was a gap between the competitive wage and the monopsony wage, and the regulated wage was set between them, then the employers were still exerting monopsony power. This meant that if the minimum was increased but not to the level of the competitive wage, monopsony power was still being exerted.604 [721] Prof Borland’s view was that, taking into account monopsony effects,605 the impact of an increase in minimum wages becomes ambiguous. Accordingly he did not commit to the idea that there would be negative effect for every case.606 He said that often the literature on minimum wages found the effects to be relatively small, and the idea of monopsony effects had been found as one of the factors that explains that. He considered this to be relevant in this case where there was a large proportion of young people employed and there are large employers.607 He indicated that market power could vary in different jobs markets.608 [722] Prof Lewis agreed that if there was monopsony power that could have a mitigating effect on employment loss. However, he did not consider that to be important in this particular case. Asked about whether there was monopsony power in the supermarket sector, he said that he considered there was huge competition for youth labour and a lot of job switching,609 but also 600 PN152. 601 PN148-149. 602 Exhibit 1, Borland principal report, [46]. 603 PN370 604 PN373. 605 Prof Borland considered the use of “monopsony” to be more apt than “oligopsony” in the absence of strategic interaction between firms: PN312. 606 PN134. 607 PN337. 608 PN369. 609 PN1478. [2026] FWCFB 75 196 that there was considerable underutilisation of young people.610 He considered it to be a competitive labour market.611 [723] Prof Lewis doubted the relevance of international studies, saying that in his opinion the international cases were so different to what was proposed for Australia, and the findings so mixed, that the international literature offered little help to us in this case.612 Having expressed that view, he went on to opine that the majority of econometric studies, internationally, as to demand for labour, youth employment, and labour costs, found a significant negative effect.613 Prof Lewis had referred to a Neumark and Wascher study from 2013 that showed teen elasticities near - 0.3. Under cross-examination he agreed614 this elasticity had been in the unpublished version of the study,615 and that the later, published version put the elasticity at approximately - 0.15.616 [724] Dr Hyslop referred to various international studies and said:617 “Although the estimates for teens are perhaps higher than other workers, they are still predominantly modest, with a central estimate likely towards to the lower end of the [- 0.1, - 0.3] elasticity range.” He used these elasticities in his calculations of the impact of the SDA’s proposed changes, if made, in his first report.618 Under cross-examination he confirmed that his preferred elasticity for junior workers was around - 0.1.619 He considered - 0.3 to be the upper bound.620 He had used the elasticity of - 0.39 in his second report because Ai Group had asked him to conduct calculations using those values.621 Under cross-examination he accepted that - 0.39 lies beyond the upper bound.622 [725] Prof Holden’s view was that academic studies, overall, concluded that raising the minimum wage significantly reduced employment.623 He considered a good recent review of the literature in relation to elasticities was that undertaken in an NBER working paper by Neumark in 2018.624 He said a reasonable reading of this review was that for teenagers the elasticity was around - 0.3. Prof Holden said some studies found small elasticities close to 0. 610 PN1665. 611 PN1480. 612 Exhibit 77, Lewis report, [94]. 613 Exhibit 77, Lewis report, [98]. 614 PN1635. 615 Exhibit 78. David Neumark, J M Ian Salas and William Wascher, Revisiting the Minimum Wage–Employment Debate: Throwing Out the Baby with the Bathwater? (NBER Working Paper No 18681, National Bureau of Economic Research, 2013). 616 Exhibit 79. David Neumark, J M Ian Salas and William Wascher, ‘Revisiting the Minimum Wage Employment Debate: Throwing Out the Baby with the Bathwater?’ (2014) 67(3) ILR Review 608. 617 Exhibit 84, Hyslop principal report, [28]. 618 Exhibit 84, Hyslop principal report, [41]. 619 PN2190-91. 620 PN2192–93. 621 PN2180–83. 622 PN2193. 623 Exhibit 80, Holden report, [5]. 624 Exhibit 80, Holden report, [16], citing Neumark, David (2018). “The Econometrics and Economics of the Employment Effects of Minimum Wages,” NBER working paper 25043, available at https://www.nber.org/papers/w25043 [2026] FWCFB 75 197 Others found larger ones such as - 0.97. He also referred to the 2003 Leigh study. He said in light of those studies, an elasticity of - 0.3 was a conservative estimate, and there was considerable downside risk of larger reductions in employment.625 [726] There was some disagreement between Prof Borland and Prof Holden as to whether the study from Denmark, a birthday study, was apt to be considered amongst the studies relevant to assessing the likely elasticity of employment. The Denmark study related to the change in employment attributable to age-based increases in youth wages. We have discussed the birthday studies above. We consider them to be of limited assistance to us in understanding likely impacts on total employment, or on youth unemployment, or on the employment of junior employees generally. They are of some assistance in understanding the effect of age-based increases on employees of the particular age associated with the age-based increase. [727] In his reply report, Prof Borland considered Dr Hyslop’s choice of elasticity to be a valid representation of the international literature, while Prof Holden’s was not.626 As to the latter, he said:627 “Professor Holden bases his choice of - 0.3 on the contention that this is a reasonable estimate of the wage elasticity of employment for teenagers. In my opinion, this is problematic for two reasons. First, it is not representative of the employment elasticity for teenagers in the international literature on the impact of an economy-wide increase in the minimum wage. For example, Professor Hyslop cites a meta-study by Wolfson and Belman (2019) which reports an estimated elasticity of - 0.13 for teen workers; and cites the Dube and Lindner (2024) review paper as estimating a median OWE of - 0.17 for narrow groups such as teenagers. Second, how teenagers are affected by an increase in an economy-wide minimum wage is likely to be very different to how teenagers are affected by an increase in targeted youth minimum wage rates for workers covered by specific awards. These changes to minimum wages involve different changes to the relative price of different types of labour and hence there cannot be any presumption that the same type of adjustment in employment would occur. Hence, the literature on which Professor Holden relies is not directly relevant to the proposed changes in youth rates.” (paragraph references omitted) [728] Prof Borland went on to criticise Prof Holden’s reliance on the Leigh 2003 study, noting the criticisms of it and stating that the more recent study by Bishop628 was considered to be the superior Australian study on the impacts of economy-wide minimum wage increases.629 [729] Prof Borland also considered the approach taken by Dr Hyslop and Prof Holden of calculating separate effects for different age groups and then aggregating them would cause an 625 Exhibit 80, Holden report, [17]-[19]. 626 Exhibit 3, Borland Reply report, [13]. 627 Exhibit 3, Borland Reply report, [15]. 628 Exhibit 4, Research Discussion Paper – Effect on Minimum Wage Increases on Wages, Hours Worked and Job Loss, James Bishop, Reserve Bank of Australia, 2018. 629 Exhibit 3, Borland Reply report, [16]. [2026] FWCFB 75 198 over-estimate of the total impact on youth employment because it failed to take into account substitution between workers aged 15 to 20 years. [730] Prof O’Brien disagreed with the use of elasticities of - 0.3 and - 0.39 but agreed with Dr Hyslop that the appropriate employment elasticity was - 0.1 was appropriate.630 He accepted under cross-examination that - 0.3 was a possible upper bound estimate.631 [731] Prof O’Brien provided an analysis of the international studies including the studies referred to by Prof Holden. He said the elasticity of - 0.97 referred to in Prof Holden’s report was derived from data for adults and was not relevant.632 He said in his opinion neither the Neumark study of 2014 nor the Neumark study of 2018 provided evidence to justify an elasticity of - 0.3; to the contrary it indicated an employment elasticity of - 0.14 to - 0.15.633 Among other things, he said the Neumark study from 2018, that Prof Holden had referred to, had been affected by there being significant flaws in the research cited in it. He said the more recent research by Neumark634 confirmed a preferred employment elasticity for teenagers of - 0.15.635 The SDA put these matters to Prof Holden in cross-examination. Prof O’Brien also referred to other more recent studies including a meta-analysis and a subsequent quantitative analysis by Martínez and Martínez of 2021.636 [732] We have made findings as to this issue, having regard to the evidence, below. Evidence as to potential for hours substitution or changes to the basis of employment [733] The Bishop study637 related to National Wage Cases where flat dollar increases had been awarded, which means the increases had differing impacts on different classifications, because the increase was a higher proportion of lower paid classifications than of higher paid classifications. The Bishop study had found the National Wage Case increases had had no statistically significant effect on hours worked or the job destruction rate. As stated above, however, the parties considered studies regarding general minimum wage increases to be of less relevance in these proceedings. He agreed this study had virtually no relevance to assessing the impacts of this application. [734] Prof Lewis indicated the Denmark birthday study suggested that when employees reached their birthday they did not necessarily get fired but their number of hours got 630 Exhibit 7, O’Brien reply report, [3]. 631 PN653. 632 Exhibit 7, O’Brien reply report, [40]. 633 Exhibit 7, O’Brien reply report, [43]. 634 Neumark, D. and Shirley, P. (2022). “Myth or Measurement: What Does the New Minimum Wage Research Say about Minimum Wages and Job Loss in the United States?” Industrial Relations: A Journal of Economy and Society 61 (4): 384–417; and Jha P, Neumark D and Rodriguez-Lopez A (2022) ‘What's across the border? Re-evaluating the crossborder evidence on minimum wage effects’, IZA-Institute Of Labor Economics. 635 Exhibit 7, O’Brien reply report, [50]-[52]. 636 Exhibit 7, O’Brien reply report, [49]. These studies had found various elasticities for teenagers and youth aged 20-29 years, generally and in developed countries only, in the range of - 0.067 to - 0.13. 637 Exhibit 4, Research Discussion Paper – Effect on Minimum Wage Increases on Wages, Hours Worked and Job Loss, James Bishop, Reserve Bank of Australia, 2018. [2026] FWCFB 75 199 reduced.638 He also said that he had heard anecdotally from a family member that at Coles it was quite common that when people reach a certain age their hours diminished.639 He considered that distribution of employment as between age groups changed more through hours changes than through changes to employment.640 As to supply, RAFFWU asked Prof Lewis whether employees might prefer to work fewer hours if they were paid more. Prof Lewis considered the opposite to be true because there was a greater opportunity cost of not working.641 RAFFWU also asked Prof Lewis whether another response to this application might be to employ people as part-time employees rather than as casuals, in light of the hourly rate being less. He agreed that was a possibility. [735] Prof Borland was asked if he was aware of research or phenomena that as a worker got older and their wage rates went up, they got less work.642 He said he was not. He said that care would be needed to avoid confusing causation with correlation. [736] The SDA submitted that643 notably, while many of the employer lay witnesses said that if wages were increased, they would reduce the hours of their employees as they get older, none said that they already do this. The SDA submitted that not one had said that on their employees turning 18 or 19 or 20, they cut back their hours to reduce the wages bill. The SDA submitted that was because “those employees are valuable.” [737] Our findings in relation to these issues are set out below. Experts’ views on the effect of the SDA’s application if granted [738] Prof Borland considered the SDA’s proposed increases in minimum junior rates in each of the General Retail Industry Award and the Pharmacy Industry Award would have “minimal impact on total employment,” and their proposed increases in the Fast Food Industry Award would have “a small impact on total employment,” with the proposed changes for all three awards likely to “cause some substitution between employees by age.” [739] Prof Borland had assessed the likely increase in total costs as a consequence of the variations if made. He relied on Prof O’Brien’s report as the source for the retail industry’s share of total employment of persons aged 15 to 20, and junior employees’ share of total employment in the fast food industry. As can be appreciated from the below, Prof Borland considered the presence of market power to be relevant in relation to the general retail and fast food industries. [740] Dr Hyslop cautioned us that his estimated impacts of the changes should be treated as tentative because his analysis focused on “the award changes as simple minimum wage 638 PN1513. 639 PN1514. 640 PN1664. 641 PN1689. 642 PN294-PN295. 643 PN4687. [2026] FWCFB 75 200 changes, implicitly assuming full coverage within the relevant jurisdiction in isolation of wider labour market considerations.”644 General retail industry [741] Prof Borland’s reasons for his opinion as to the effect of the proposed changes to General Retail Industry Award were as follows:645 “First, to the extent that the employment outcome from the increases in junior minimum wage rates is determined by labour demand, the substitution and scale effects on total employment are likely to be minimal. • Substitution effect: Increases in the relative cost of junior employees who benefit from the proposed changes to junior rates, at least for some age groups affected, are of sufficient magnitude to be likely to cause substitution between junior employees and/or between junior and adult employees. Where labour-to- labour substitution occurs, the impact is likely to be spread over time, as the international evidence reviewed in section 3 indicates that substitution mainly happens via hiring when employers replace employees affected by the increase in minimum junior rates who quit their jobs. Importantly, labour-to-labour substitution involves replacing one employee with another, and hence implies a limited impact on total employment. As well, there seems unlikely to be significant substitution of capital for labour. It is easier to substitute other types of labour, and the size of increase in total costs does not seem sufficient to justify major capital replacement. • Scale effect: The small size of the increase in total costs from the increase in junior minimum wage rates, even if fully passed through to price, implies a small increase in price, and hence there is unlikely to be a significant decrease in demand for output. The international evidence reviewed in section 3 supports that there would be a limited impact on demand for output from any increase in price. Hence, there would be little decrease in employment through a scale effect. Second, where employers in the retail industry have market power in the labour market, this will moderate any negative impact on employment, and may even generate a small increase in employment. That employers have and exercise market power in some labour markets, and that therefore the impact of minimum wages on employment is likely to be less negative or positive in those labour markets, is now well-established, as has been described in my review above of the international literature … This literature also indicates that the channel through which the impact of a higher wage on employment operates is by employees who receive an increase in minimum wage remaining in their jobs for a longer time. Taking into consideration that employers might have market power is especially relevant for junior employees, whose outside options are more limited than for older workers. On this point, it is important to note that the 644 Exhibit 84, Hyslop principal report, [35]. 645 Exhibit 1, Borland principal report, [67]-[69]. [2026] FWCFB 75 201 retail industry accounts for a large share of total employment of persons aged 15 to 20 years, 19. 9 per cent … Third, the international evidence that I reviewed in section 3 reveals small impacts from increases in youth minimum wage rates of similar magnitudes to the increases proposed by the SDA – both on total employment and employment of workers aged 15 to 20 years.” (citations omitted) [742] In response Prof Lewis said:646 “With respect to the effects of the proposed award changes on employment, the extent to which total employment falls depends on businesses’ ability to pass on the increased labour costs to customers in higher prices. If sales do not react much to price increases (demand is inelastic, in economic jargon) then total employment will not fall by a significant amount due to an increase in labour costs. The relatively low increase in total costs suggest that, at least for the industry, it would not reduce total employment by a great degree. However, the industry is not entirely homogeneous with respect to businesses, and an analysis at the level of the business might well reveal different conclusions.” [743] As can be appreciated, Prof Lewis here appears to be referring to total employment across the industry, and making the point that the impact on employment across the industry would not be uniform. He went on to say:647 “More important than the effects of total industry costs on total employment, is the effect of changes to junior awards on the distribution of employment. Because of the structure of inputs in retailing, apart from labour, there is very little businesses can easily change to cut their cost. However, the most immediate way to react to a cost in particular categories of labour is to replace them with labour that is relatively cheaper. Economic theory states that when the costs of different types of labour change relative to one another the demand for the labour type with the larger relative increase in cost will fall relative to the type of labour whose labour costs less. That is, there is a substitution between different types of labour. The degree to which substitution occurs depends on the degree of physical substitution – the ease with which it is possible for tasks to be reallocated between employees of different ages- (this would be expected to be particularly so in the case of retail where most jobs are fairly low-skilled.) and the share of each labour type in total cost of labour. The share of each labour type in total cost of labour is important because businesses can reduce the magnitude of increases in total labour costs by reducing employment of the largest contributor to that costs increase relative to other types of labour whose contribution is relatively smaller. 646 Exhibit 77, Lewis report, [10]. 647 Exhibit 77, Lewis report, [11]-[13]. [2026] FWCFB 75 202 The empirical results derived by Prof Borland and I, suggest that if employers wish to minimise the effects on their profits due to the award changes, they will reduce employment (numbers or hours) of 17 to 19 year olds but, particularly 20 year olds. Cost increases can be minimised by employing more juniors (or increasing the hours) for those 16 years and under. The potential for doing this might be limited due to adolescents at this age being in full-time schooling. Businesses would be expected to consider adult workers to be more worthwhile employing (increasing hours) since for the same wage costs they can employ workers with more experience and maturity and other characteristics which make them more productive than 18 to 20 year olds. (emphasis and punctuation in original) [744] As indicated above, Dr Hyslop initially used the elasticities of - 0.1 and - 0.3 to calculate possible employment loss. He said648 that for the case of an employment elasticity of - 0.1, this implied approximately 2–2.5% youth employment loss across the three awards, whereas for an elasticity of - 0.3 the employment loss would be around 5.5 – 8%. Dr Hyslop used figures from A profile of employee characteristics across modern awards, Fair Work Commission Research Report 1/2023,649 by Yuen and Tomlinson of the FWC, to estimate the employment loss that would occur if the SDA’s application was to be granted, having regard to those elasticities. The data in the Yuen and Tomlinson report related specifically to award-reliant employees, and not all employees in the respective industries. Dr Hyslop’s estimates of the losses was “about 1,000 (and up to 3,500)” for youth workers covered by the General Retail Industry Award.650 He said there were caveats to bear in mind, including that:651 • to the extent that firms substitute away from employing (affected) youth workers to employing (unaffected) young adults, the net employment effects in the sectors will be lower, noting the evidence on labour-to-labour substitution was mixed; • the extent of employment loss would depend on how effectively binding the wage increases will be, and the analysis assumed that wages would be lower in the absence of the awards, but if the award wage acted as a “magnet wage” for workers who would otherwise earn higher wages as well as lower wages, then the true number of affected youth workers may be lower; and • the estimates did not take into account possible interactions with the wider labour market. [745] Ai Group subsequently commissioned a further report from Dr Hyslop, to provide alternative estimates using different source data as to the number of employees, and using a different assumed employment elasticity. The different source data related to the total number of youth workers aged 15 to 20, by age, employed in the ‘Retail Trade’ and ‘Cafes, Restaurants and Takeaway Food Services’ industries in August 2024. The data were based on employment counts from the Australian Bureau of Statistics’ Characteristics of Employment (CoE) survey 648 Exhibit 84, Hyslop principal report, [44]-[45]. 649 Yuen & Tomlinson (2023). 650 Exhibit 84, Hyslop principal report, [4]. 651 Exhibit 84, Hyslop principal report, [46]-[48]. [2026] FWCFB 75 203 rather than the Yuen and Tomlinson report, in which the data had been derived from the Australian Bureau of Statistics’ Survey of Employee Earnings and Hours (EEH) microdata which had, for the first time, enabled analysis of employees across individual modern awards. [746] Dr Hyslop preferred the industry-wide rather than award reliant data, considering his earlier use of the latter to have been a mistake652 because “the minimum wage literature on the employment effects for population subgroups (e.g. youth) generally takes the employment risk- set to be the full subgroup employment, rather than the subset of directly-affected workers…”. [747] In reply, Prof Borland criticised the use of the CoE survey, preferring Census data.653 Prof O’Brien said the employment estimates for Retail Trade and Cafes, Restaurants and Takeaway Food Services, as provided to Dr Hyslop by the Ai Group, represented overestimates of the number of youth potentially affected by any policy change. Use of these estimates has the effect to produce higher estimates of job loss than Prof O’Brien considered to be reasonable or appropriate.654 Dr Hyslop was asked about the second report at the hearing. The SDA submitted:655 “Under cross examination, Dr Hyslop confirmed that in preparing his second report, he simply adopted the ABS age-group employment data provided to him by AI Group without undertaking any assessment of its accuracy or reliability.656 He accepted that inaccurate inputs will yield inaccurate outputs, yet nonetheless took the ABS figures “as read”.657 When taken to Professor Borland’s criticisms of the limitations of ABS employment-survey data, Dr Hyslop stated that he lacked the requisite knowledge of either ABS survey methodology or the Australian labour market to assess those criticisms. He therefore accepted Professor Borland’s observations.”658 (emphasis in original) [748] Prof O’Brien also disagreed with Dr Hyslop’s initial use of data related to award-reliant employees, because he considered increases in the junior rates in the three awards may spill over to other youth on non-Award employment agreements.659 [749] We appreciate the point being made that award variations, if they have employment effects, may have employment effects beyond the direct effects on award-reliant employees. There may be effects in the same industry, in relation to employees covered by enterprise agreements rather than being reliant on awards, but such effects would be affected by the terms of such agreements, the extent to which agreement rates are higher than award rates, and the outcomes of enterprise bargaining. Such effects would also be spread over time. We consider there is utility in considering the potential effects in relation to award-reliant employees, as well 652 Exhibit 85, Hyslop supplementary report, [11]. 653 Exhibit 3, Borland reply report, [19]. 654 Exhibit 7, O’Brien reply report, [4]. 655 SDA’s closing submissions, [195]. 656 Citing PN2205. 657 Citing PN2203 to PN2205. 658 Citing PN2212 to PN2213. 659 Prof O’Brien reply report, [5]. [2026] FWCFB 75 204 as in relation to the broader cohort of award-covered employees. We consider this approach consistent with the Annual Wage Review 2025 Decision.660 [750] The Ai Group also asked Dr Hyslop to calculate employment loss using the elasticity derived from the Leigh (2003) study referred to above as originally published. Dr Hyslop acceded to this request but also calculated revised estimates based on his own preferred range of - 0.1 and - 0.3. We prefer Dr Hyslop’s own view as to the most relevant estimates of elasticities to the Ai Group’s. We have also, for reasons set out elsewhere, taken the view that Dr Leigh’s study is of little assistance to us in these proceedings. [751] Prof Holden used an elasticity of - 0.3 to calculate a 12.9% reduction in employment for 18-year-olds, given a 42.86% increase in their rate.661 This latter figure was derived from 18- year-olds’ rates going from 70% of the adult rate to the full adult rate. He also provided a calculation in relation to 17-year-olds. [752] In his reply report, Prof Borland continued to rely on his earlier findings. He raised an issue in relation to whether the assumption that the increase in youth rates would be fully passed through to labour costs might cause overestimation of employment effects, but this was more directed to the Fast Food Industry Award variations and is referred to below. He also considered that Prof Lewis, Dr Hyslop, and Prof Holden had not considered the effect of employers’ monopsony power on how the proposed increases would affect youth employment. [753] Prof Borland referred to consistencies between his own opinion and Prof Lewis’s. He said that where his own opinion differed from Prof Lewis’s was in relation to the likely magnitude of any change in the distribution of employment. He gave the following three reasons:662 “• First, the existence of monopsony effects in the affected labour markets would potentially reduce the role of substitution effects. • Second, to achieve what might be the ‘point in time’ cost minimising combination of workers of different ages is dependent on the supply of workers of those different ages being available. For example, substitution towards adult workers requires a supply of adult workers willing to take on employment in the affected industries. • Third, the proposed changes in youth rates and the likely nature of adjustment, in my opinion make it impossible to be definitive that large substitution effects would occur. As I noted in my original report substitution is unlikely to occur immediately via firings and hirings of workers of different ages – instead the international evidence suggests that substitution would occur over time, with employers using the opportunity of worker turnover to hire new workers on the basis of changes to the relative cost of labour that have occurred. Then, once a new worker is hired, the future employment of that worker will not necessarily proceed exactly according to changes in the relative cost of employing workers of different ages. For example, suppose as a result of a resignation 660 Annual Wage Review 2025 Decision, [13]-[23]. 661 Exhibit 80, Holden report, [21]. 662 Exhibit 3, Borland reply report, [24]. [2026] FWCFB 75 205 by an 18 year old employee, a business hires a new 16 year old employee, whose relative cost is lower (following implementation of the proposed increases in youth rates). Where that new employee quits before they turn 17 years, the employer might then hire another 16 year old, for the same reason of the relative cost of labour. But if the employee who was hired at 16 years turns 17 years old while still working at the same business, there cannot be any assumption that they would then be replaced by a 16 year old. Factors such as the cost of turnover to an employer and legislative restrictions on unfair dismissal are both reasons why that employee would be retained, even though the relative cost of labour from 17 year olds has increased.” [754] Prof O’Brien, in his reply report, used Census data to calculate the employment effects, adjusting for the proportion of workers aged 15 to 20 who were employed in classification levels 1 to 3. This data went beyond award-reliant workers to all workers of that age group in the industries he considered to be relevant to the General Retail Industry Award, regardless of pay-setting method. He considered that, in total, 192,015 workers aged 15 to 20 years were estimated to be potentially affected, compared to 268,200 from the second Hyslop Report. Prof O’Brien said that according to the latest data from the ABS Employment Earnings and Hours survey (ABS 2023), approximately 44 percent of youth employed in Food Retailing and Other Store Based Retailing ANZSIC Subdivisions were paid Award rates of pay, implying that less than half of his 192,015 estimate should be directly affected by the change to youth Award wage rates. He considered that any change would flow on indirectly to an unknown proportion of those covered by enterprise agreements (as well as flowing on to people covered by individual contracts). He said his estimate of potentially affected youth should be considered as an upper bound to the potential employment effects of the proposed variations.663 Prof O’Brien gave estimates for the ages 15 to 20; given our decision to leave junior rates for minors unchanged, we note that Prof O’Brien calculated the following relevant changes for elasticities - 0.1 to - 0.3:664 • Age 18, displacement of between 1,676 and 5,028 employees • Age 19, displacement of between 1,253 and 3,758 employees • Age 20, displacement of between 97 and 292 employees. [755] Prof O’Brien made explicit that no substitution was assumed in his estimates, notwithstanding he thought some substitution was likely. Prof O’Brien also made calculations for the elasticity derived from the Leigh study though he did not accept that was an appropriate elasticity. Fast food industry [756] As to his opinion that the change to the Fast Food Industry Award would have a small impact on total employment, Prof Borland gave the following reasons:665 663 Exhibit 7, O’Brien reply report, [67]-[69]. 664 Exhibit 7, O’Brien reply report, [74], and Table 2. 665 Exhibit 1, Borland principal report, [90]-[92]. [2026] FWCFB 75 206 “First, to the extent that the employment outcome from the increases in junior minimum wage rates is determined by labour demand, the substitution and scale effects on total employment are likely to be small. • Substitution effect: Increases in the relative cost of junior employees who benefit from the proposed changes to junior rates, at least for some age groups affected, are of sufficient magnitude to be likely to cause substitution between junior employees and/or between junior and adult employees. Also relevant is that junior employees account for a large share of total employment in the fast food industry, 70 per cent … which implies a greater incentive for substitution effects based on an increase in the relative cost of junior employees as an input. Where labour-to-labour substitution occurs, the impact is likely to be spread over time, as the international evidence reviewed in section 3 indicates that substitution mainly happens via hiring when employers replace employees affected by the increase in minimum junior rates who quit their jobs. Importantly, labour-to-labour substitution involves replacing one employee with another, and hence implies a limited impact on total employment. Over a longer time horizon, the increase in labour costs may induce some substitution of labour by capital, which would bring a negative impact on total employment. However, the capacity to substitute to labour that has not received an increase in its minimum wage, and the size of increase in total costs, would limit the extent of capital replacement. • Scale effect: The increase in junior minimum wage rates, if passed through to prices, would cause a moderate increase in the price of output. International evidence reviewed in section 3 however indicates limited decreases in the demand for output following price changes due to a minimum wage rise. One explanation for this effect would be that the increase in minimum wage is industry-wide, hence affecting costs and prices of all employers in the industry. Based on the evidence of a limited negative impact on the demand for output, the scale effect on employment would be small. Second, where employers in the fast food industry have market power in the labour market, this will moderate any negative impact on employment, and may even generate a small increase in employment. That employers have and exercise market power in some labour markets, and that therefore the impact of minimum wages on employment is likely to be less negative or positive in those labour markets, is now well-established, as has been described in my review above of the international literature in section 3. This literature also indicates that the channel through which the impact of a higher wage on employment operates is by employees who receive an increase in minimum wage remaining in their jobs for a longer time. Taking into consideration that employers might have market power is especially relevant for junior employees, whose outside options are more limited than for older workers. In this regard, it is important to note that the fast food industry accounts for a large share of total employment, 18.5 per cent, for persons aged 15 to 20 years … . Third, the international evidence that I reviewed in section 3 reveals small impacts from increases in youth minimum wage rates of similar magnitudes to the increases proposed [2026] FWCFB 75 207 by the SDA – both on total employment and employment of workers aged 15 to 20 years. (citations omitted) [757] As to employment Prof Lewis said:666 “The reasoning put forward in the discussion of the impact of junior wage changes in Retail apply here also for the Fast Food industry. The difference in impacts relates mainly to the size of the increases in labour costs and, particularly, relative labour costs. Because the Fast Food industry would experience much greater relative costs changes than Retail, the impacts on the Fast Food industry would be expected to be far greater than for Retail. In summary, the effects of the increase in junior awards proposed would be a modest reduction in total employment in the industry as a whole but the major effect will be a change in the distribution of employment by age of worker. Businesses will reduce employment (numbers or hours) of 17 to 19 year olds but, particularly 18 year olds. Cost increases can be minimised by employing more juniors (or increasing the hours) 16 years old. This would not likely be possible without adversely affecting educational performance. There would be greater employment of workers aged over 20 years old.” [758] Dr Hyslop’s initial estimates for the Fast Food Industry Award were “about 2,500 to 3,000 (and up to 9,000).”667 As with the estimates for the General Retail Industry Award these were tentative and subject to the caveats referred to above. Dr Hyslop subsequently provided revised estimates which we have not found as useful for the reasons set out above. [759] Prof Holden again used an elasticity of - 0.3 to calculate a 12.9% reduction in employment for 18-year-olds, given a 42.86% increase in their rate.668 This latter figure was derived from 18-year-olds rates going from 70% of the adult rate to the full adult rate. [760] Prof Borland, in reply, considered the reports of Professors Lewis, Hyslop, and Holden shared the limitations that their reports were premised on the assumption that there would be full pass-through of the proposed increases in youth rates to employers’ costs of labour. He said his report had made the same assumption, for the purpose of avoiding underestimation of the employment effects. However, having regard particularly to the Fast Food Industry Award, the assumption would likely cause an overestimate of employment effects, including because of the likely decrease in employee turnover. His difference of opinion with Prof Lewis as to the magnitude of substitution effects was apposite to this award as well. [761] In his reply report, Prof O’Brien gave estimates for the Fast Food Industry Award, on a similar basis to the estimates he had provided for the General Retail Industry Award. They were, for elasticities of - 0.1 to - 0.3:669 666 Exhibit 77, Lewis report, [20]. 667 Exhibit 84, Hyslop principal report, [4]. 668 Exhibit 80, Holden report, [51]. 669 Exhibit 7, O’Brien reply report, [80] and Table 3. [2026] FWCFB 75 208 • Age 18, displacement of between 1,343 and 4,030 employees • Age 19, displacement of between 508 and 1,524 employees • Age 20, displacement of between 193 and 579 employees. Community pharmacy industry [762] As to the opinion that the impact in relation to the proposed variation to the Pharmacy Industry Award would be minimal, Prof Borland gave the following reasons:670 First, to the extent that the employment outcome from the increases in junior minimum wage rates is determined by labour demand, the substitution and scale effects on total employment are likely to be minimal. • Substitution effect: Increases in the relative cost of junior employees who benefit from the proposed changes to junior rates, at least for some age groups affected, are of sufficient magnitude to be likely to cause substitution between junior employees and/or between junior and adult employees. Where labour-to- labour substitution occurs, the impact is likely to be spread over time, as the international evidence reviewed in section 3 indicates that substitution mainly happens via hiring when employers replace employees affected by the increase in minimum junior rates who quit their jobs. Importantly, labour-to-labour substitution involves replacing one employee with another, and hence implies a limited impact on total employment. As well, there seems unlikely to be significant substitution of capital for labour. It is easier to substitute other types of labour, and the size of increase in total costs does not seem sufficient to justify major capital replacement. • Scale effect: The small size of the increase in total costs from the increase in junior minimum wage rates, even if fully passed through to price, implies a small increase in price, and hence there is unlikely to be a significant decrease in demand for output. The international evidence reviewed in section 3 supports that there would be a limited impact on demand for output from any increase in price. Hence, there would be little decrease in employment through a scale effect. Second, the international evidence that I reviewed in section 3 reveals small impacts from increases in youth minimum wage rates of similar magnitudes to the increases proposed by the SDA - both on total employment and employment of workers aged 15 to 20 years. [763] Prof Lewis and Prof Holden’s reports went only to the General Retail Award and Fast Food Award, and so there was no opinion in their reports in relation to the employment effects of the proposed variation in the community pharmacy industry. [764] Dr Hyslop’s initial estimates for the Pharmacy Industry Award were “about 150 (and up to 550).”671 As with the estimates for the General Retail Industry Award these were tentative 670 Exhibit 1, Borland principal report, [104]-[105]. 671 Exhibit 84, Hyslop principal report, [4]. [2026] FWCFB 75 209 and subject to the caveats referred to above. Dr Hyslop also provided revised estimates which we have not found as useful for the reasons set out above. [765] Prof O’Brien did not provide estimates, in his reply report, for this industry. Absence of evidence as to employment effects of past changes to wage rates [766] The SDA also noted that672 the employer parties had not led any evidence to establish that past changes to wages had had employment effects. It submitted that the employers had not led any evidence as to whether the penalty rate cuts in fast food had led to increased employment, or of any job cuts following increases to minimum wages. [767] There have been changes to junior rates in the three awards. In the General Retail Industry Award, junior rates were removed for employees aged 20 with more than six months’ experience, and for employees in classifications about level 3. Junior rates were also altered in the Pharmacy Award, so that they no longer applied to employees in classifications above level 2. Our attention has not been directed to any studies as to whether there were any employment effects of these changes. We do not know whether there were any such effects. Annual wage review [768] We also wish to note, at this stage, that in the Annual Wage Review 2025 Decision the Expert Panel considered the possibility of disemployment effects connected with the annual wage review increases to minimum wages. They said that in the context of a labour market that remained strong overall it was not likely there would be any aggregate disemployment effects. They went on to say:673 “The last three annual wage reviews have seen nominal increases in the NMW and modern award minimum wage rates that have, because of the rate of inflation, been significantly higher than for the preceding decade, but there has not been any discernible adverse consequence for employment growth or the rate of unemployment. Some positive national economic effect is likely, in that modern award minimum wage rate increases will support household consumption and consumer sentiment.” [769] As with the general minimum wage studies, economy-wide increases to award minimum wages and the national and special national minimum wages are different to, and are likely to have different effects from, increases to junior rates across these three awards. We cannot take any assistance from the Annual Wage Review 2025 Decision as to the likely effects of the variations sought in these proceedings. On the other hand, this is an illustration of why it is not a matter of simply adopting a particular estimate of elasticity from the academic literature and assuming it will play out in practice. In practice, not all else stays equal, and there can be second round effects of changes. 672 PN4688. 673 Annual Wage Review 2025 Decision, [41]. [2026] FWCFB 75 210 Findings as to employment effects [770] We make the following observations and findings in relation to the possible employment effects of any variations to the junior rates in the three awards. [771] We generally preferred the evidence of Professors Borland, Lewis, and O’Brien, and Dr Hyslop, to Prof Holden’s evidence in relation to potential employment effects, because their expertise was in labour economics, having regard to their curricula vitae provided with their reports. Prof Holden’s curriculum vitae did not indicate that his main area of expertise was labour economics. He was cross-examined about whether he was a labour economist. He said he would not describe himself as a producer of labour economics and was not published in that field.674 [772] We turn first to our findings regarding various measures relating to the elasticity of demand for labour. Employment elasticities [773] We accept that there are no direct analogues in the literature to variations proposed in the current case. We accept that literature relating to changes made to youth rates are of most relevance. We also accept that the literature regarding changes made to minimum wages of general application to an economy or industry are of limited relevance. We accept that the birthday studies are generally of limited relevance however we have considered them useful in relation to potential distribution effects discussed below. [774] We do not accept Prof Holden’s assessment of the literature as giving rise to a conservative elasticity of - 0.3 for teenagers, given his reliance on the sources cited by leading author Neumark in 2018,675 of which some were excluded in the more recent Neumark and Shirley study in 2022676 and also given the other expert evidence. The conclusions that Professors Borland and O’Brien, and Dr Hyslop, drew from the international literature were more (though not wholly) consistent with each other. Prof Lewis considered there would be a significant negative effect but doubted the relevance of international literature. [775] We accept Prof Borland’s view that the presence of labour market power is relevant to the likely employment effects in the general retail and fast food industries. For the reasons stated elsewhere in this decision we do not consider the existing Australian literature in relation to the employment effects of increases to the minimum wage generally to be of significant assistance to us. [776] We accept that employment effects would not be uniform across firms. 674 PN1742. 675 Professor Holden had cited Neumark, David (2018). “The Econometrics and Economics of the Employment Effects of Minimum Wages,” NBER working paper 25043, https://www.nber.org/papers/w25043 676 Exhibit 82, Neumark, David, and Shirley, Peter. (2022). ‘Myth or Measurement: What Does the New Minimum Wage Research Say about Minimum Wages and Job Loss in the United States?’, (2022) Industrial Relations: A Journal of Economy and Society 61 (4): 384–417. [2026] FWCFB 75 211 Award-reliant and award-covered employees [777] The SDA submitted that an anterior issue had arisen in relation to the number of employees covered by the three awards. [778] Professor O’Brien used the FWC mapping tool to determine the number of employees in relevant ANZSIC industry sub-divisions covered by each of the three Awards. He then calculated estimates of the total number of employees in the industries covered by each of the Awards, including the total number of junior (up to age 20) employees in each sub-sector where available, using data from the 2021 Census, the August 2023 ABS Characteristics of Employment survey, and the February 2024 ABS Participation, Job Search and Mobility survey. We accept that Prof O’Brien’s approach was appropriate to assist us in understanding the number of employees likely covered by the awards. [779] As indicated above, Dr Hyslop had previously used a published research paper by staff of the FWC as his source for numbers of award-reliant employees. He later described this as a mistake and in his second report he instead used different data pursuant to instructions from Ai Group. [780] We consider that both data in relation to award-reliant employees, and award-covered employees, are informative. Award-reliant employees are obviously directly affected by changes to their pay rates under the awards. Employees to whom enterprise agreements apply can be directly affected if a variation resulted in the award base rate being greater than the base rate payable to them under the agreement.677 They can also be affected by future comparisons between new enterprise agreements and the awards for the purposes of the better off overall test. For that reason, data as to award-reliant employees may understate the number of directly affected employees and data as to award-covered (but not necessarily reliant) employees may overstate the number. We consider it is preferable to avoid understatement in considering potential employment effects so we prefer to have regard to the broader category. [781] As to assessing the numbers of employees covered, we prefer the evidence of Prof O’Brien to that of Dr Hyslop in relation to the general retail and fast food industries in his second report. We prefer Prof O’Brien’s evidence because of the data sources he used, and Dr Hyslop’s appropriate concessions as to his lack of familiarity with the Australian labour market.678 As to the fast food industry, we prefer Prof O’Brien’s use of the ANZSIC subclass 4512 – Takeaway services679 to Prof Lewis’s use680 of the broader ANZSIC Industry 45 Food and Beverage Services, as subclass 4512 is more closely aligned to the Fast Food Industry Award coverage.681 Findings as to employment elasticities [782] In light of our consideration above we consider the more useful of the specific estimates as to the likely effect of the SDA’s proposed variations, if made, on labour demand, holding all 677 Fair Work Act s 206. 678 PN2212 to PN2213. 679 See Exhibit 6, O’Brien principal report, [16]-[18], and Table A1. 680 Exhibit 77, Lewis report, [58] and Table 5. 681 The other classes of industry 45 include 452 Pubs, Taverns and Bars and 453 Clubs (Hospitality), and the other subclasses of class 451 include 4511 Cafes and Restaurants and 4513 Catering Services. [2026] FWCFB 75 212 else equal and in the absence of any adjustments including substitution by employers in response to the increases, were Prof O’Brien’s calculations for award-covered but not necessarily award-reliant employees, for the general retail and fast food industries. These calculations provided682 for numbers of displaced employees aged 18 in the general retail industry of between 1,676 and 5,028 for elasticities - 0.1 to - 0.3; and, for employees aged 19, 1,253 to 3,758 for those same elasticities. As we have decided not to change the rates for 20- year-olds we do not consider the effect on 20-year-olds to be relevant. Prof O’Brien’s commensurate calculations for the fast food industry683 were: 1,343 to 4,030 for 18-year-olds; 508 to 1,524 for 19-year-olds; and 193 to 579 for 20-year-olds. Prof O’Brien did not provide commensurate estimates for the community pharmacy industry, as he had been responding to Dr Hyslop’s report, and Dr Hyslop had been instructed to report only as to general retail and fast food. [783] However, though we consider Prof O’Brien’s calculations the better of the calculations applying elasticities, their utility is still limited. The elasticity of - 0.3 was of a different magnitude to those Prof Borland considered reflected the current state of the literature. We also consider that a bare exercise of applying elasticities of employment to numbers employed is of limited utility to us in understanding the likely consequences of the variations for employment. The approaches of Professors Borland and Lewis provide us with a more complete picture of the likely consequences. [784] Beyond those findings it is unnecessary for us to attempt to predict the precise change in demand for labour or in employment that would follow the variations we have decided to make. It suffices to state that we accept that: (a) varying the three modern awards so that minimum wages for young adults (save for inexperienced young adults) are no longer less than minimum wages for other adults will likely have a small negative impact on the employment of people aged 18 to under 20 in the general retail industry, and of people aged 18 to under 21 in the fast food and community pharmacy industries, at least at first instance; and (b) the extent of the impacts can be affected by various factors. [785] As our decision is to retain the current junior rates for workers under 18, and to phase in the changes for workers 18 and over, any disemployment effects across the whole cohort of employees aged under 21 as a whole will be less than those estimated by the experts and spread over time. Potential impacts of increased labour costs on total employment in the three industries [786] The expert evidence indicates that we would not expect any significant change in total employment if the SDA’s application were to be granted. Again, we note the expert evidence was based on the application being granted in full. We consider our decision to retain junior rates for minors in their current form in these three awards will mean that the impact on labour 682 Exhibit 7, O’Brien reply report, [74] and Table 2. 683 Exhibit 7, O’Brien reply report, [80] and Table 3. [2026] FWCFB 75 213 costs would be less than anticipated by the experts, and would mitigate downward pressure on employment in the industry. [787] As indicated above, Prof Borland considered that in each of the general retail and pharmacy industries the increase in total costs would be small and so would any corresponding increase in price. Professor Lewis agreed that the increase in total costs would be small in proportion terms. [788] As also indicated above, Professors Holden and O’Brien, and Dr Hyslop calculated employment loss for specific cohorts of young workers based on the employment elasticities they considered appropriate. Professors Borland and Lewis gave qualitative evidence as to the effects on employment, described above. These effects would relate to the young employees whose pay rates changed. Given the variations we have decided to make, the affected employees would be those aged 18 to 20 at the time of phasing-in of the change. These workers would fall within the scope of the demographic considered by the ABS in relation to youth unemployment (which relates to the age range 15-24).684 [789] Prof O’Brien sought to put the employment impacts of variations to the General Retail Industry Award and Fast Food Industry Award into perspective for us in his reply report. He said:685 “The estimated magnitude of job loss using the preferred elasticities of - 0.1 to - 0.15, considered by me to be upper bounds of any potential job loss, is in fact relatively small compared to the size of the youth labour market and month to month fluctuations observed in labour force data. Using seasonally adjusted labour force data from June 2025, there were a total of 832,700 persons aged 15 to 19 years employed in Australia. Using an elasticity of - 0.15, the maximum estimated job loss (6,402686 + 5,251) would represent less than 1.4687 per cent of current total 15 to 19 year employment. If restricted to an estimate of youth employment loss for those on Awards only, this would equate to a maximum job loss (3,108 + 3896) or 0.8 per cent of current 15 to 19 year employment. Putting this into perspective, between June 2024 to June 2025 the total number of people 15 to 19 years employed has fluctuated by an average of 9,500 persons from month to month, including regular fluctuations of over 10,000 workers employed…”.688 [790] Prof O’Brien was here referring to figures premised on the assumption that the whole of the SDA’s application would be granted in respect of both awards. Given our decision in relation to minors, the totals would be less. 684 Australian Bureau of Statistics. (2023). The Labour Force framework. ABS. https://www.abs.gov.au/statistics/detailed- methodology-information/concepts-sources-methods/labour-statistics-concepts-sources-and-methods/2023/concepts-and- sources/labour-force-framework. 685 Exhibit 7, Prof O’Brien reply report, [81] to [83]. 686 This figure differs from the published report, see the correction made at hearing, PN619. 687 This figure differs from the published report, see the correction made at hearing, PN619. 688 Citing ABS (2025) Table 17. Labour force status for 15-19 year olds by Sex - Trend, Seasonally Adjusted and Original, 6202.0 Labour Force, Australia. [2026] FWCFB 75 214 [791] Of all of the international studies in relation to changes to youth rates, we consider those regarding the changes in New Zealand in 2001 to be of most salience. As we do not intend to alter or remove junior rates for minors, we do not consider the 2008 reforms to be as relevant. The research in relation to the 2001 reforms suggests small (if any) employment effects for minors, potentially an increase in hours worked by minors, and small (if any) employment effects for young adults. [792] The ARA submitted the expert evidence was bolstered by the evidence of Ms Cousens and Ms Bridges in respect of the likely impact on the operations of Coles, Kmart, and Target.689 Each had canvassed the likelihood that if wages increased there would be fewer casual and/or junior team members rostered and fewer hours offered.690 The ARA also pointed to the survey attached to Ms Brown’s statement which showed sixty-six respondents said they would reduce junior hiring of the relevant age group if junior rates increased.691 Some other lay witnesses also referred to the possibility of employing fewer young workers of the affected age, or offering fewer shifts, though most said they would hire other workers instead.692 [793] There was also some lay evidence that some firms might consider taking alternative measures such as reducing trading hours if the cost of junior employees increased. We consider our decision not to alter junior rates for employees aged under 18 would reduce any such effects, because labour costs attributable to such workers would not be affected and because of the potential for substitution of minors in place of young adults. [794] Taking into account the expert and lay evidence, and having regard to the foregoing, we consider the weight of the evidence shows there would be little impact on total employment in the three industries if the variations were wholly granted, and less impact if the variations were granted only in part. [795] Any employment effects may be further reduced if employers make adjustments, other than reducing the number of employees, in response to increased labour costs, or if the variations positively affect labour supply by reducing employee turnover. We have discussed possible adjustments and other responses in our consideration of likely impacts on business, below. Here it suffices to observe that such adjustments, if they were able to be made, would likely reduce any impact on total employment within the three industries. 689 The ARA’s closing submissions, [131]. 690 Referring to Exhibit 110, statement of Ms Cousens, [64]-[66]; Exhibit 109, statement of Ms Bridges [71]-[72]. 691 Exhibit 108, statement of Ms Brown, annexure FB2, Survey, q 8. 692 Fast food industry: Exhibit 94, statement of Mr Carrington, [21]; Exhibit 86, statement of Ms Johnston, [58]; Exhibit 88, statement of Mr Morton, [33], albeit he says fewer older workers would be needed to do the same amount of work; Exhibit 101, statement of Mr Humphreys, [35]; cf Exhibit 95, statement of Ms Bletsas, [40(b)]. Other retail: Exhibit 118, statement of Mr Bongiovanni, [30]; Exhibit 74, Statement of Ms Koch, [31]; Exhibit 117, statement of Mr Luchterhand, [20], though under cross-examination he conceded that he already generally did not hire people aged 18 to 21. pharmacy: Exhibit 114, affidavit of Ms Chisholm, [49]; Exhibit 116, affidavit of Mr King, [56]; Exhibit 111, affidavit of Ms Knight [44]-[47] though she thought the application if granted would have little impact on their hiring part-time employees; Exhibit 113, affidavit of Mr On, [61]; Exhibit 115, affidavit of Ms Kennedy, [64]; Exhibit 112, affidavit of Mr Zoghbi, [60]. [2026] FWCFB 75 215 [796] Having regard to the expert evidence, some potential costs impacts may be able to be defrayed through substitution. We have considered the potential for substitution both towards minors and towards older adults, which we have discussed below. [797] Prof Lewis considered the distribution of employment may be a more relevant consideration than any change in total employment across the three industries. All of the experts considered substitution effects though Prof Borland disagreed with Prof Lewis as to the magnitude of any substitution effects. We now turn to the issue of how the variations may affect the distribution of employment by age in the three industries. Distribution changes, hours substitution, and effects on employment of particular cohorts [798] We have above considered the potential effects on total employment within the three industries. A related issue is whether there would be any effects on the distribution of employment; whether the hours offered to employees of different ages would change, or whether there would be labour-to-labour substitution by reference to age. We have considered the potential for substitution both towards minors and towards older adults, which we have discussed below. Prof Borland said the “…total change in employment will be the net effect of changes for youth and changes for adults. The impact on youth cannot be taken as prediction of total impact on employment.”693 [799] As we have decided not to alter the junior rates for people aged under 18, while applying the general minima to people aged 18 and above (subject to the provision we make for inexperienced workers), the gap between rates for 17-year-olds and 18-year-olds will be substantial, going from 60% of the adult minimum to 100%. This will be a greater increase compared to the current increase from 60% to 70% of the adult minimum. [800] Save for Dr Hyslop’s reference to the Olssen paper of 2011, no party or witness pointed us to any research into whether there is any employment (or disemployment) effect attributable to the increase in wage on employees’ birthdays under the junior rates currently prescribed in the three awards. Prof Lewis was asked about whether there was any such research and said as far as he was aware there was no research in that area in Australia.694 [801] As to international experience, as indicated above, Prof Holden referred us particularly to the experience in Denmark, and the study by Kleiner, and also encouraged caution in the use of international literature. [802] The Kleiner study indicates that there was little difference between youth unemployment in Denmark compared with other OECD countries. Prof Holden said there may have been substitution towards younger workers in Denmark.695 [803] The Dutch study referred to a step-change system based on age, whereas the Danish study referred to a single jump at age 18, with no other age-based changes. We have here decided to retain step changes for minors, without changing their relativities to the adult wage, 693 Exhibit 3, Borland reply report, [17]-[18]. 694 PN1679. 695 PN2094. [2026] FWCFB 75 216 meaning there would be a significant jump at age 18 (outside of inexperienced employees). This is a mid-point between the Dutch and Danish scenarios. Neither is a direct analogue for that reason and the reasons stated above. [804] Professor Lewis pointed out the most immediate way to react to a cost in a particular category of labour is to replace the workers with labour that is relatively cheaper.696 Prof Borland agreed with Dr Hyslop that the international literature provided mixed evidence on labour-to-labour substitution. However, Prof Borland observed that the literature concerned was about increases to an economy-wide minimum wage, where the scope for labour-to-labour substitution was more limited than would be the case for the differential increases in minimum wage rates by age group proposed by the SDA.697 However, he also identified factors that may militate against substitution.698 Prof Holden explained that if the application were granted there could be substitution away from 17- and 18-year-olds from low-income households who may be engaged in a full-time capacity, towards 16-year-old part-time employees who were in high school, which may be good for the 16-year-olds but it was bad for the 18-year-olds.699 [805] As we have indicated, we propose to remove junior rates for people aged 18 or over, save during a six month period for inexperienced employees. We have decided not to alter the rates for people aged under 18. This means, under the variations we have decided to make, within the three industries, there will be changes to the relative cost of employing workers aged 18 to 20, workers aged under 18, and workers aged 21 and over. Minors will improve their cost competitiveness as against young adults, with no change to their cost competitiveness as against people aged 21 and over. Young adults will no longer have a cost advantage as against people aged 21 and over and will have a greater cost disadvantage compared to minors. [806] We also observe that the changes we have decided to make will increase the relative competitiveness of workers on other special wage rates, namely workers eligible for the supported wage because of disability, and workers to which training apply, with experienced employees aged 18 to 20 inclusive. Also, in the community pharmacy industry, removing access to discounted rates for people aged 18 to 20 would increase pharmacy students’ relative cost competitiveness with them. [807] Taking only the cost relativities as between young adults and others, if there is to be labour-for-labour substitution it should, subject to other factors such as supply issues and regulatory constraints, be in favour of minors for genuinely entry-level work where maturity and experience are of less salience, and in favour of adults aged 21 or over where maturity and experience provide a net increase in value. We say net increase because of some of the lay evidence which suggests that young adult workers may have greater capacity for or willingness to perform manual or menial tasks than older adults, as well as different availability. In community pharmacy, the worker’s enrolment in tertiary studies may also be relevant. [808] The lay evidence shows that in fast food minors routinely perform the full gamut of duties in the Level 1 classification, with the exception that younger minors do not operate the 696 Exhibit 77, Lewis report, [11], [43], [66]. 697 Exhibit 3, Borland reply report, [17]. 698 Exhibit 3, Borland reply report, [24]. 699 PN2095. [2026] FWCFB 75 217 deep fryer. This suggests that if minors retain their price competitiveness as against the 21 plus cohort, and increase it as against the 18 to 20 cohort, substitution towards the younger workers may occur. [809] Employer preference is not the only driver; labour-for-labour substitution will also be subject to, inter alia, labour supply constraints and substitution costs affecting the elasticity of substitution. Prof Lewis considered that the elasticity of substitution was not known for the retail and fast food industries but would be negative and not zero.700 As to supply, we do not have evidence to indicate the likely supply of people aged 21 to retirement age for jobs currently attracting the junior rates under consideration in these proceedings (level 1 and 2 pharmacy assistants, level 1, 2 and 3 retail assistants and fast food employees) but we can generally observe that unemployment across the economy is low, as indicated elsewhere in these reasons. However, Prof Lewis’s evidence in cross-examination was that there was considerable underutilisation of labour amongst 20- to 24-year-olds.701 [810] As to minors, they would be affected by availability and potential impacts on education,702 though Dr Hyslop referred us to a study by Giuliano in which she considered there had been an increase in labour supply of teenagers in response to their higher relative wages.703 As to substitution costs, the evidence was that substitution is not frictionless and takes time.704 Prof Borland referred to the presence of monopsony effects in the affected labour markets, supply constraints, and constraints on and costs associated with turnover of employees as militating against substitution.705 Constraints on replacing employees included regulatory constraints such as unfair dismissal laws. Costs included training costs. [811] The SDA submitted there was not a skerrick of credible evidence amongst the experts to support that hours substitution would occur, or that, if it did, it would make any difference to total employment.706 We agree with their submission that Prof Lewis’s reference to what he had heard from a family member does not assist us. The Denmark study also provides us with limited assistance in this regard as it relates to a different economic and regulatory context. On the other hand, the evidence from Ms Bridges707 and Ms Cousens708 indicated that employee cost was taken into account in rostering and the number of hours offered. We can infer that cost considerations could affect hours offered. [812] The forces against substitution (such as regulatory constraints) are greater for employee- for-employee replacement, which Prof Borland considered the main means by which substitution occurred,709 than for substitution effected through increasing some workers’ hours and decreasing others’ hours. 700 Exhibit 77, Lewis report, [48]-[49]; [72]-[73]. 701 PN1471. 702 See Exhibit 77, Lewis report, [20], [49]. 703 Exhibit 84, Hyslop principal report, [33]. 704 Exhibit 1, Borland principal report, [67]. 705 Exhibit 3, Borland reply report, [24]. 706 PN4686. 707 Exhibit 109, statement of Ms Bridges, [43]-[44]. 708 Exhibit 110, statement of Ms Cousens, [64]. 709 Exhibit 1, Borland principal report, [67]. [2026] FWCFB 75 218 [813] Hours substitution is in our view more relevant to questions of underemployment than unemployment. We accept there is no evidence that hours substitution would affect total employment. [814] In addition to the considerations we have referred to above, the parties made submissions as to whether the proposed variations would have different effects in rural and regional areas compared with metropolitan areas. We have discussed this below. Capital-to-labour substitution [815] Substitution of capital in place of experienced workers aged 18 to 20 would involve technological change. The lay evidence indicates that employers in fast food and retail are already investigating options such as (further) automation or artificial intelligence.710 But this does not extend to detailed evidence about the relative cost of capital and labour, whether at the current junior rates or at the proposed adult rates. It stands to reason that if juniors who are young adults have a higher wage floor then the relative cost of capital is lower; this tells us nothing about whether the change in relative cost is material, or about the costs involved in substitution. As stated above, Prof Lewis pointed out the most immediate way to react to cost change is labour-for-labour substitution.711 Prof Borland’s opinion was that it seemed unlikely there would be significant substitution of capital for labour, noting that it is easier to substitute other types of labour, and the size of increase in total costs did not seem sufficient to justify major capital replacement. The evidence does not support a finding that capital-for-labour substitution is likely as a consequence of the variations we have decided to make. Summary [816] We accept the SDA’s submission that there was broad agreement among the experts, except for Prof Holden, as to the impacts on youth and total employment being small.712 We accept Professor Borland and Professor Lewis’s respective views that the effect is likely to be minimal or modest in the general retail and community pharmacy industries. We accept it is likely to be small or modest in the fast food industry. Further, we have found the weight of the evidence shows there would be little impact on total employment in the three industries if the variations were wholly granted, and less impact if the variations were granted only in part. [817] We have found, above, that varying the three modern awards so that minimum wages for young adults (other than inexperienced young adults) are no longer less than minimum wages for other adults will likely have a small negative impact on the employment of people aged 18 to under 20 in the general retail industry, and of people aged 18 to under 21 in the fast food and community pharmacy industries, at least at first instance, and that the extent of the impacts can be affected by various factors. 710 Exhibit 88, statement of Mr Morton, [34]; Exhibit 109, statement of Ms Bridges, [74]; Exhibit 108, statement of Ms Brown, Annexure FB2, q 8; Exhibit 80, Holden report, [10]. 711 Exhibit 77, Lewis report, [11], [43], [66]. 712 PN4624. [2026] FWCFB 75 219 [818] We find that labour-to-labour substitution may occur, as between young adults and minors, and/or as between young adults and other adults, but only to a limited extent, given the regulatory constraints and other frictions. Such labour-to-labour substitution, where it occurs towards minors, would reduce the extent to which any small negative impact on the employment of young adults would translate to a small negative impact on the employment of employees aged under 21 as a whole in the three industries. [819] Hours substitution is not strictly relevant to the question of whether there would be a reduction in employment (i.e. by headcount) of young adults. However, we find that it is possible that employers, especially large employers with sophisticated rostering arrangements, would adjust the hours offered, in response to the variations. [820] We have found that the evidence does not support a finding that capital-for-labour substitution is likely as a consequence of the variations as sought or the narrower variations we have decided to make. [821] We find that any employment effects will be spread over time according to phase-in arrangements. [822] Having dealt generally with the issue of employment effects we will now consider the limbs of the modern awards and minimum wages objectives, including consideration of the relevance of potential employment effects to our consideration of those objectives. The modern awards and minimum wages objectives [823] We will now turn to the question of whether variation is necessary to achieve the modern awards and minimum wages objectives. We have set the objectives out above. We have taken a similar approach to the approach we took with work value, which is to treat evidence in respect of one award as evidence in respect of the others where appropriate, and deal with consideration in common across all three awards, before making findings in respect of each award. Not every party made submissions on every issue and we have not recited every submission made in these reasons, but we have considered them all. We particularly note that the Pharmacy Guild’s written outline was predominantly directed to work value issues rather than the modern awards and minimum wages objectives. Principles applicable to the two objectives [824] The modern awards objective is to ‘ensure that modern awards, together with the National Employment Standards, provide a fair and relevant minimum safety net of terms and conditions’, taking into account the particular considerations identified in ss 134(1)(a)–(h) (the s 134 considerations). [825] The general principles applicable to the interpretation and application of s 134(1) are well-established. They were summarised by the Full Bench in the Real Estate decision (in a passage recently adopted in the Gender-based undervaluation decision)713 as follows:714 713 [2025] FWCFB 74; 340 IR 1, [30]. See also Variation of awards on the initiative of the Commission [2020] FWCFB 1837, and Application by The Australian Industry Group [2025] FWCFB 292, [89]. 714 The Real Estate decision, [54]–[56]. [2026] FWCFB 75 220 The modern awards objective is very broadly expressed. It is a composite expression which requires that modern awards, together with the National Employment Standards (NES), provide a fair and relevant minimum safety net of terms and conditions, taking into account the matters in s 134(1)(a)–(h). Fairness in this context is to be assessed from the perspective of the employees and employers covered by the modern award in question. The obligation to take into account the s 134 considerations means that each of these matters, insofar as they are relevant, must be treated as a matter of significance in the decision-making process. No particular primacy is attached to any of the s 134 considerations and not all of the matters identified will necessarily be relevant in the context of a particular proposal to vary a modern award. It is not necessary to make a finding that the award fails to satisfy one or more of the s 134 considerations as a prerequisite to the variation of a modern award. Generally speaking, the s 134 considerations do not set a particular standard against which a modern award can be evaluated; many of them may be characterised as broad social objectives. In giving effect to the modern awards objective the Commission is performing an evaluative function taking into account the matters in s 134(1)(a)–(h) and assessing the qualities of the safety net by reference to the statutory criteria of fairness and relevance. What is ‘necessary’ to achieve the modern awards objective in a particular case is a value judgment, taking into account the s 134 considerations to the extent that they are relevant having regard to the context, including the circumstances pertaining to the particular modern award, the terms of any proposed variation and the submissions and evidence… [826] Variations to modern awards must be justified on their merits. The extent of the merit argument required will depend on the circumstances. Significant changes where merit is reasonably contestable should be supported by an analysis of the relevant legislative provisions and, where feasible, probative evidence. 715 [827] In the Penalty rates decision the Full Bench said that the Commission will proceed on the basis that prima facie a modern award achieved the modern awards objective when it was made.716 As indicated above, a more recent Full Bench (in the Pharmacy (APESMA Work Value Claim) decision) has said that there can be no implicit assumption that at the time an award was made its wage rates were consistent with the modern awards objective.717 In any event, in light of the 2014 General Retail Junior Rates (20-year-olds) decision and our consideration above, we do not assume that the modern awards, insofar as they provided for junior rates, met the modern awards objective. [828] The objective of stability does not take priority over the ultimate task of ensuring that modern awards provide a fair and relevant safety net. The discretion of the Commission is not 715 Re Horticulture Award, [14], citing Re Shop, Distributive and Allied Employees Association (2011) 211 IR 462, [24]; cited in the Penalty Rates decision, [269]. 716 The Penalty Rates decision, [269], referred to in Application by The Australian Industry Group [2025] FWCFB 292, [89], note 46. 717 Pharmacy (APESMA Work Value Claim) decision, [169], citing the Real Estate decision, [80]. [2026] FWCFB 75 221 constrained by any requirement to demonstrate material change of circumstance as a precondition to a modern award being varied.718 [829] There is a distinction between what is “necessary” and what is “desirable” which does not carry the same imperative for action. However, obviously enough, reasonable minds may differ as to whether particular action is necessary or merely desirable.719 What is ‘necessary’ to achieve the modern awards objective in a particular case is a value judgment, taking into account the s 134 considerations to the extent that they are relevant having regard to the context, including the circumstances pertaining to the particular modern award, the terms of any proposed variation, and the submissions and evidence.720 [830] The minimum wages objective also requires an evaluative judgement, balancing the prescribed and other relevant considerations.721 [831] We have decided to consider the provisions of ss 284 and 134 together, in the order we consider most useful for the purposes of these proceedings. As there is a limb of s 284 directly relevant to fair minimum wages for junior employees, we will commence our consideration there. A fair and relevant minimum safety net of terms and conditions, and a safety net of fair minimum wages [832] The two objectives are each aimed at providing a fair or a fair and relevant safety net. The modern awards objective is that the Commission must ensure that modern awards, together with the National Employment Standards, provide a fair and relevant minimum safety net of terms and conditions, taking into account the various matters set out in subsection 134(1). The minimum wages objective is that the Commission must establish and maintain a safety net of fair minimum wages, taking into account the various matters in subsection 284(1). This ‘safety net’ is also referred to in s 3, as one of the means by which the Fair Work Act’s object – to provide a balanced framework for cooperative and productive workplace relations that promotes national economic prosperity and social inclusion for all Australians – is given effect. As stated above the object includes, in s 3(b): “(b) ensuring a guaranteed safety net of fair, relevant and enforceable minimum terms and conditions through the National Employment Standards, modern awards and national minimum wage orders; …” [833] We deal with fairness in the next section. The SDA submitted that the current junior rates were not relevant because junior rates had been set by reference to a legacy rationale (the ‘needs’ basis) that had since been rightly discarded as no longer fit for purpose. We note that the modern awards objective refers to relevance whereas the minimum wages objective does 718 Shop, Distributive and Allied Employees Association v The Australian Industry Group [2017] FCAFC 161; (2017) 253 FCR 368 (“Penalty rates judicial review decision”), [33]-[34]. 719 Shop, Distributive and Allied Employees Association v National Retail Association & Anor (No 2) [2012] FCA 480; (2012) 205 FCR 227, [46]. 720 Variation of awards on the initiative of the Commission [2020] FWCFB 1837, [117]; the Real Estate decision, [54]-[56]. 721 Annual Wage Review 2025 Decision, [4]. [2026] FWCFB 75 222 not. This perhaps implies that the relevance of minimum wages goes without saying, whereas that is not necessarily true of every award condition over time, as working arrangements change. Fair minimum wages for junior employees, trainees and employees with a disability (s 284(1)(e)) [834] In establishing and maintaining a safety net of fair minimum wages, the Commission must take into account “providing a comprehensive range of fair minimum wages to junior employees, employees to whom training arrangements apply and employees with a disability.”722 As indicated above junior employees are those aged under 21.723 [835] The SDA submitted that the junior rates under consideration are not fair, because it is a perversion of the principle of equal pay for equal work for employees aged between 18 and 21 to be paid less than employees aged over 21 who are doing the same job. It submitted the concept of equal work for equal pay as a matter of principle is undermined by artificially creating or maintaining exceptions for its application. For employees aged under 16 and aged 17, the SDA submitted the current percentages were not fair because they do not reflect the true value of the work they perform. [836] The SDA submitted that this limb, of itself, does not require the Commission to set junior rates for all junior employees and says nothing about the fairness of such wages in any given industry or occupation. It submitted many modern awards contain no provision for junior rates (e.g., Air Pilots Award 2020, Ambulance and Patient Transport Award 2020, Car Parking Award 2020, Building and Construction Award 2020).724 It submitted other awards only have junior rates for some employees under 21 (for example the Alpine Resorts Award 2020 or the General Retail Industry Award).725 [837] The Ai Group submitted that given the Commission, as a relevant consideration, is required to take into account providing a range of junior rates, it is very unlikely, as a matter of construction, that a proper exercise of the Commission’s discretion would be to abolish junior rates. It submitted the language of “providing” is in a sense a ‘doing’ word in that provision. The exercise of the power is to provide for the comprehensive range. It also says providing a range of wages, which is the plural, not the singular.726 The Ai Group acknowledged that not every award had to have junior rates,727 and submitted it was “no surprise that [junior rates] were found in the award with the most amount of juniors.”728 [838] The ARA, in its closing submissions, submitted that given that the Commission in the Annual Wage Review 2025 Decision would have had regard to its statutory obligation under s 284(1)(e) to provide for “a comprehensive range of fair minimum wages to junior employees”, 722 Fair Work Act, section 284(1)(e). 723 Fair Work Act, s 12. 724 As indicated above the SDA noted that there are apprentice rates in the Building and Construction Award, but these are competency-related, not age related. 725 SDA’s closing submissions, [35]. 726 PN4949. 727 PN4956. 728 PN4958. [2026] FWCFB 75 223 the position adopted in that decision should be understood as reflecting the appropriate settings for wages for junior employees.729 We do not accept this submission, not least because the Annual Wage Review 2025 Decision explicitly contemplated that junior rates would be considered in these proceedings.730 [839] The MGA submitted that the current junior rates within the General Retail Industry Award provided a fair and relevant minimum safety net given the level of experience and standard of work performed by junior employees when compared to adult employees. It also submitted that if an increase in junior rates results in fewer employment opportunities for junior employees, then it is inconsistent with the intention of the proposals to provide a fair and relevant minimum safety net. It submitted that whilst the safety net for employees who were employed might be higher, there would be fewer junior employees that are actually employed in the first place.731 [840] This obligation to take into account providing comprehensive, fair minimum wages for, inter alia, junior employees, is found in the minimum wages objective which applies to the safety net of fair minimum wages as a whole, not only minimum wages set by awards. That is to say, it applies to the performance or exercise of:732 (a) the Commission’s functions or powers under Part 2-6 (Minimum wages); and (b) the Commission’s functions or powers under Part 2-3 (Modern Awards), so far as they relate to setting, varying or revoking modern award minimum wages. [841] For the safety net to include a comprehensive range of minimum wages for juniors, it must include minimum wages for all junior employees. Plainly, junior employees are a subset of all employees.733 Where awards provide for adult rates to be paid to all employees, that has the effect of prescribing minimum wages for, inter alia, junior employees. Similarly, where an award provides special rates for a class of junior employees but requires that all other employees (including juniors not in the class) be paid the adult rate, it still provides, comprehensively, for minimum wages for junior employees. [842] The Yuen and Tomlinson report734 to which Dr Hyslop referred stated that around 1 in 10 employees on modern awards are paid a junior rate. They said while the majority (58 per cent) of employees aged 20 years and under were paid junior rates, 24 per cent were paid adult rates while apprentice/trainee and disability rates accounted for the remaining 18 per cent.735 The three categories in paragraph 284(1)(e) are not mutually exclusive. 729 The ARA’s closing submissions, [80], [120]. 730 Annual Wage Review 2025 [2025] FWCFB 3500, [120]. 731 MGA’s outline of submissions, [100]. 732 Fair Work Act, s 284(2). 733 Having regard to the definitions in Fair Work Act, s 12. 734 Yuen & Tomlinson (2023). 735 Ibid, at 23. [2026] FWCFB 75 224 [843] The national minimum wage also forms part of the safety net. There must be a special national minimum wage for junior employees who are award/agreement free,736 and the (general) national minimum wage does not apply to junior employees.737 [844] Modern awards may738 include terms about minimum wages (including wage rates for junior employees, employees with a disability and employees to whom training arrangements apply), and skill-based classifications and career structures (as well as incentives, piece rates and bonuses), but only to the extent necessary to achieve the modern awards objective and, to the extent applicable, the minimum wages objective.739 A modern award must not include terms that discriminate against an employee because of, or for reasons including, the employee's age.740 However, a term of a modern award does not discriminate against an employee merely because it provides for minimum wages for all junior employees, or a class of junior employees.741 This exclusion is necessary because but for it, minimum wages for junior employees would contravene the prohibition on discrimination because of age. [845] Taken together, the statutory provisions to which we have referred mean, relevantly, that: • to meet the minimum wages objective, when exercising the power in Part 2-3 to vary award wages, the Commission should take into account whether award minimum wages are (or will be, if the variation is made) comprehensive in relation to junior employees, so that every junior employee who is not award/agreement free has an award minimum wage applying to their employment; and • the minimum wages applying to junior employees are to be fair minimum wages; and • the minimum wages applying to all junior employees, or a class of junior employees, can be different to the minima applying to other employees without contravening the prohibition on discriminatory award terms. [846] We also take this as meaning that despite the SDA’s objection to exceptions to the principle of equal pay for work of equal value, the Fair Work Act contemplates such an exception provided the minimum wages are “fair”. [847] It is uncontroversial that each of the three awards should provide for minimum wages for all junior employees within the award’s coverage. It is also not in contest in these proceedings that it is fair for the minimum wages for junior employees, employed in classifications other than those to which junior rates apply, to be the adult rates. The contest relates to what minimum wages would be fair for junior employees employed within Levels 1 to 3 of the General Retail Industry Award, Levels 1 and 2 of the Pharmacy Industry Award, and all levels of the Fast Food Industry Award, and whether ‘fairness’ in this context turns only on work value or on other considerations. It is not in contest that their rates should be set by 736 Fair Work Act, s 294(1). An "award/agreement free employee" means a national system employee to whom neither a modern award nor an enterprise agreement applies: Fair Work Act, s 12. 737 Fair Work Act, s 294(3). 738 Fair Work Act, s 139. 739 Fair Work Act, s 138. 740 Fair Work Act, s 153(1). 741 Fair Work Act, s 153(3). [2026] FWCFB 75 225 reference to proportions of the respective adult rates. It is in contest whether the current proportions are fair. What does “fair” mean, in this context? [848] As indicated above, fairness in the context of the objectives of establishing a fair safety net is to be assessed from the perspective of the employees and employers covered by the modern award in question. We consider the same applies to considering what would represent fair minimum wages for junior employees. [849] The existence of paragraph 284(1)(e) implicitly acknowledges that junior employees, employees in training, and employees with a disability have less power than, and are disadvantaged compared with, other employees. From the employees’ perspective this has two relevant effects, in our view. The first is that these employees have less bargaining power when it comes to wages and are more vulnerable to exploitation, meaning that, absent regulation, they would be at greater risk of accepting wages that represent less than would be warranted by work value. The second is that these employees are at a competitive disadvantage in the labour market, giving rise to the question posed by the Ai Group: how are young people (and the others referred to in this provision) supposed to get and keep jobs? So, assessing the fairness of junior employees’ minimum wages involves not only questions of whether their pay is commensurate with the value of their work, but also whether they are being given a fair opportunity to compete for jobs. [850] We do not accept that fairness in this context is a concept confined only to work value. We consider that to be “fair,” minimum wages for junior employees should strike a balance between providing for pay commensurate with work value and other fairness considerations including, most relevantly, assisting young people to get and keep jobs despite labour market disadvantage. That leads us to consider the potential effects of changes to the junior rates in the three awards under consideration for people who are aged under 21 and work in general retail, fast food, or pharmacy, as well as on people who are under 21 generally. We focus here on those in the labour market; we have dealt with workforce participation separately below. We also, here, focus on the effect that proposed changes to junior rates would likely have on the employment of workers within the coverage of the three awards. This is obviously a narrower question than the potential effects on employment or youth employment generally, which we have dealt with below in our consideration of the national economy and likely impacts on it. [851] Labour market disadvantage can impede a person from getting and keeping a job which can affect their present and future earning capacity and income. It can arise because of actual costs and constraints and/or employer perceptions. We consider it uncontroversial to say that of workers affected by labour market disadvantage because of young age, the youngest workers generally have the greatest competitive disadvantage. We also consider that this competitive disadvantage decreases over time so there is less of a case that it is fair to allow junior employees to accept discount rates, as they get older. Plainly enough, no corresponding issue arises as to employers’ competitiveness in the labour market (i.e. competition for attracting and retaining workers) because junior rates are minimum wages. [852] We are cognisant of the risks of suggesting that junior rates are fair if they assist to overcome labour market disadvantage associated with perceived (but not actual) shortcomings. [2026] FWCFB 75 226 We are also alive to the historic arguments seeking to justify lesser rates for Aboriginal stockmen on the grounds that equal pay would cause disemployment.742 There have also been various historical justifications for paying women less than men. 743 We distinguish the attributes of race and gender, where disadvantage arises from prejudice, from the attribute of young age, where labour market disadvantage can arise from both prejudice and actual differences in work value. The benefits of employment for young people [853] We have taken note of the parties’ evidence and submissions as to the intersection between employment, education (secondary and higher), and training, the benefits of employment, and the potential consequences of labour market scarring. As to the latter, we accept that the research put before us related to economic downturns, and we consider Prof Borland’s view, that this research is therefore of little relevance to the task before us here,744 to be the more plausible. However, more generally, having regard to both the research and first principles we can accept a number of propositions from the Ai Group’s aide memoire745 going to the value of work for young people, especially young people with greater disadvantages, including that: • the transition from education to employment is a critical phase for young people and this process is everyone’s core business to support a smooth transition for young people; • if not in education, employment or training, young people can experience social and economic disadvantage; • working part-time generally assists the academic performance of young people and/or has a positive impact on post-school full-time employment, compared with not working at all; though combining school and work has a modest negative impact on school and post-school outcomes when hours are long (in excess of 15 to 20 hours per week);746 • positive effects on post-school employment outcomes are seen from working in Year 12 for both males and females who do not go on to post-school full-time study; and • young people living in the lowest socioeconomic areas in Australia are more than twice as likely as those young people living in the highest areas to be not in employment, education or training. [854] The Ai Group submitted that where an individual has not worked by the age of 25, the risk of long-term unemployment is higher. It submitted junior employment helps to overcome 742 Cattle Station Industry (Northern Territory) Award (1966) 113 CAR 651 (the Aboriginal Stockmen’s Case), 658, 665- 668. 743 See for example the Equal Pay Case [1969] CthArbRp 278; (1969) 127 CAR 1142; National Wage and Equal Pay Cases 1972 [1972] CthArbRp 1420; (1972) 147 CAR 172; and the Gender-based undervaluation decision. 744 PN545. 745 Ai Group’s Aide Memoire on research evidence propositions of fact. 746 Ai Group’s Aide Memoire on research evidence propositions of fact, [15]. [2026] FWCFB 75 227 this problem for youth, and that holding down a job early is a “bridge” to employment in adulthood. It submitted working develops a teenager’s work-related knowledge, skills and habits and signals general work aptitude to prospective employers.747 [855] The Ai Group had also relied on Quinn v Overland748 and Trego v Wesbeam Pty Ltd,749 at [78], as authority that there is value in work for its own sake. In the latter case, the Court had described work as “a source of self-respect, of purpose, of a sense that one is contributing to one’s family’s wellbeing and to the community.” The Court also took note that work could bring satisfaction and a workplace could be a source of social support.750 [856] The lay witnesses had also referred to the benefits to junior employees, of gaining training and experience, including Ms Sharp, who had spoken of the McDonald’s RTO and the more recent move towards microcredentials, which could give rise to recognition of prior learning, in cooperation with universities.751 [857] In addition to the labour market scarring issue referred to above, the ARA referred752 us to evidence from Prof Borland under cross-examination, in which he had said that if young people are delayed for any reason, including, relevantly, because there is less prospect of them being employed, that could cause long-term negative effects.753 Professor Borland had accepted that the retail industry can provide an opportunity for low-skilled workers relative to other industries and that it provides flexibility for workers who are in high school. On that basis Professor Borland had accepted that a decrease in job opportunities would have a negative effect on young people.754 [858] The ARA also referred us to evidence from Prof Holden that while the research related to the impact on young people moving out of education and into work, this did not prevent the evidence from being extrapolated out to young people looking for work while they are in education as it provides the laboratory in which the causal effects are identified.755 He stated that while the source of scarring is different, the scars are all too similar.756 [859] As indicated above, the ARA also submitted that employment was important for reducing inequality for young people from low socioeconomic backgrounds particularly in rural and regional areas.757 747 Ai Group’s outline of submissions, [37], relying on Australian Institute of Health and Welfare (2021) Australia’s youth: Engagement in education or employment, Australian Government; and Jobs and Skills Australia (2025) Employers’ experiences of young job applicants: Findings from the Recruitment Experiences and Outlook Survey, Australian Government). 748 [2010] FCA 799, [101]-[103]. 749 [2019] FCA 1030. 750 Ibid, [78]. 751 Exhibit 93, statement of Ms Sharp, [11]-[15]; PN2718-PN2725. 752 ARA’s closing submissions, [45]. 753 PN548 (Borland cross-examination). 754 PN565-566 (Borland cross-examination). 755 PN2014-2018, 2020 (Holden cross-examination). 756 PN2018 (Holden cross-examination). 757 ARA’s closing submissions, [135], relying on Exhibit 77, Lewis report, [30]. [2026] FWCFB 75 228 [860] The ARA also referred to evidence from Prof Lewis that there was an inextricable link between the growth in part-time work and participation in non-compulsory education.758 The SDA submitted that Prof Lewis had accepted under cross-examination that establishing any causal link between youth employment and educational participation was very difficult.759 It submitted that in the absence of supporting evidence his opinion on this issue was speculative and should be given little weight. [861] Having considered those submissions we make the following findings. [862] Those propositions advanced by the Ai Group and accepted above, as well as the expert evidence, support the conclusion that employment is generally beneficial to persons of junior employee age for current and future employability and for broader social and economic reasons.760 We consider that conclusion to be largely uncontroversial, and also consistent with the two objectives, both of which make clear that employment and workforce participation are desirable. This fortifies our view that possible employment effects and labour market disadvantage are among the matters to be taken into account when considering fairness in the context of s 284(1)(e). [863] In light of the foregoing, we consider that fair minimum wages for junior employees would recognise the value of their work while addressing disadvantage in gaining and keeping employment. We have considered, above, the different considerations for minors compared with young adults in relation to work value. We will consider the two cohorts of junior employees separately, below. Fairness from the employers’ perspective [864] The employer lay witnesses often considered their engagement of junior employees to be both important for their business and of benefit to the juniors themselves and the wider community. Many of them referred to the potential or likely impacts on labour costs, and on their businesses, if the variations were to be made. We have dealt with these issues below, in our consideration of impacts on business. Rural and regional impacts [865] As indicated above, the parties made submissions as to whether the variations if made would have different impacts outside metropolitan areas. These submissions largely related to employment effects but they also went to broader issues, which is why we are considering them in this part of the decision. Professor Lewis’s report had considered a variety of impacts on non- metropolitan businesses, employees, and communities. The Ai Group submitted Prof Lewis’s evidence was that increases to junior rates in the fast food industry would be expected to have 758 PN1559 (Lewis cross-examination). 759 PN1567. 760 See also National Retail Association Limited [2011] FWA 3777, regarding employees who are school students, undisturbed on appeal, Re Shop, Distributive and Allied Employees Association [2011] FWAFB 6251; (2011) 211 IR 462 (Lawler VP, Watson SDP and Hampton C); appeal undisturbed under judicial review, Shop, Distributive and Allied Employees Association v National Retail Association (No.2) [2012] FCA 480; 205 FCR 227. [2026] FWCFB 75 229 a disproportionate negative impact on youth employment in rural and regional Australia.761 The ARA referred to Prof Lewis’s evidence that young workers are much more important for staffing of retail and fast food in the regions than they are in the capital cities and that these jobs in the regions, where there is lower participation in education, are a “lifeline for those communities.”762 The SDA referred us to Professor Borland’s evidence that the correct basis on which to assess the non-metropolitan impacts is the proportionate exposure of young people to employment in the relevant industries.763 Prof Borland said the proportions are the same in general retail, and larger in capital cities in fast food.764 We accept this evidence. We also accept that the impacts of changes to minimum wages are likely to vary across different geographical areas, just as economic and other conditions vary across different areas. Conclusions as to fairness in relation to minors across the three awards [866] We consider labour market disadvantage for minors could be attributable to both actual differences and employer perceptions. We have discussed above, in our consideration of work value, the actual differences associated with employing minors including likely lesser maturity, experience, and productivity; regulatory constraints on hours and duties; and different and lesser availability. [867] We consider it uncontroversial to say that minors are in a position of particular vulnerability, with less bargaining power and greater disadvantage in the labour market than other junior employees. They also face particular risks if they do not participate in employment, education, or training, which we have referred to above. [868] In our view, these considerations weigh in favour of it being fairer to retain the current rates for minors. The expert evidence supports the proposition that increasing the rates would have a small negative effect on employment. We consider refraining from increasing the rates will assist in avoiding this in respect of minors. Retaining the current rates provides small, incremental increases according to age prior to adulthood. Maintaining the rates for minors in their current proportions will also increase their cost competitiveness relative to young adults, making substitution, if it occurs, more likely to be towards minors (subject to, inter alia, supply constraints), whether they are currently employed under these awards or hope to be. The experts and lay witnesses raised the issue of capital-to-labour substitution. Prof Borland considered this unlikely given the small increase in costs to be incurred by the variations if made, and the cost of capital.765 Mr Morton told us that Hungry Jack’s was considering artificial intelligence, and particularly the automation of drive-through ordering. He said that the technology was very expensive at the moment.766 It is difficult to predict what will happen with the costs of artificial intelligence and automation in the future. Though we do not consider the risks of capital-to- labour substitution to be a major consideration, we observe that retaining the rates in their current form would mitigate any employment risk in this regard as well. 761 Ai Group’s outline of submissions, [55], referring to Exhibit 1, Borland principal report, at [85]. 762 PN1549 (cross-examination of Prof Lewis). 763 SDA’s closing submissions, [272]. 764 Exhibit 3, Borland reply report, [52]. 765 Exhibit 1, Borland principal report, [67], [90], [104]. 766 PN2423 to PN2426. [2026] FWCFB 75 230 The differing rate for employees aged under 16, in the Fast Food Industry Award [869] The SDA seeks that we vary the rate payable to all employees aged under 16 to 50% of the respective adult rates. This is a greater increase in the fast food industry; the rate for this age in the Fast Food Industry Award is 40%, whereas the rate in the other two awards is 45%. The 1977 case to which the SDA referred us,767 from Macken J, was a case in which the fast food industry was exempted from then prevailing rules about the ratios of juniors to adult employees working in the business. Macken J recognised the special nature of the fast food industry and its role in creating employment opportunities for children. As we stated above, on Prof O’Brien’s evidence 70% of employees in the retail industry covered by the Fast Food Industry Award are aged under 21. This compared with proportions of around 22% for the other two awards. At the time of his first report almost 45% were minors, and 13.3% were aged under 16.768 In the other two awards the proportions under 16 were under 2%.769 The general retail industry is much larger than the fast food industry in terms of the total number of employees. Prof O’Brien’s estimates based on Census figures were that the total number of employees in the retail industry covered by the General Retail Industry Award was 829,427, whereas for the Fast Food Industry Award coverage was 212,456. The Pharmacy Industry was much smaller, 47,921.770 [870] Though we doubt the work value of people under 16 would be relatively less in fast food than in the other two industries, we consider that the demographics tend toward the conclusion that there is a greater amount of opportunity, in fast food, for children to get their first job. We do not find that this is necessarily caused in whole or in part by the relevant rate being 5 percentage points less than the equivalent rates in the other two awards. But the correlation between the lower rate and the greater opportunity means that we should be cautious about changing the rate. Accordingly, we have decided that it would be fairer to very young employees, and children not yet in the workforce, to leave the 40% rate undisturbed at this time. Findings as to fairness in relation to young adults [871] As indicated above, we consider there are work value reasons justifying a variation to each award, in respect of the rates for young adults, and we do not find any substantial difference in the value between their work and that of people aged 21 or over, such as to justify reduced wages. In addition, we consider they need less special protection than minors, in relation to labour market disadvantage. By the time someone is a young adult they have generally had the opportunity to get sufficient experience, while of working age, to be able to work in, especially, the low-skilled classifications under the three awards we are here considering. In light of our view that young adults can perform low-skill jobs as well as adults aged 21 and over, and noting that that makes them more competitive relative to 21-year-olds than minors are, we consider it fairer to provide for young adults to be paid the adult minimum. This is not to say that young adults do not face labour market disadvantage at all. Our finding is that in light of young adults’ different relative work value and different circumstances, a different balance should be struck in deciding what is a fair minimum wage. 767 Re Shop Employees (State) Award (No 2) [1977] A.R 555. 768 Exhibit 6, O’Brien principal report, [7]. 769 Exhibit 6, O’Brien principal report, [3], [11]. 770 Exhibit 6, O’Brien principal report, [2], [6], [10].. [2026] FWCFB 75 231 [872] At the same time as forming the view that it would be fair for young adults to be paid the adult rates, we have taken account of the expert and lay evidence as to potential negative employment effects. To mitigate those effects, we consider it would be fairest to phase in the change over time, incrementally for each age. [873] Not all young adults have availed themselves of the opportunity to obtain work experience once attaining working age, often (but of course not universally) because they have been focused on education and/or training instead. Those who do not have adequate experience face greater labour market disadvantage than those who do. [874] As indicated above in 2014, the Commission decided to vary the General Retail Industry Award so that 20-year-olds would be paid adult rates, subject to having served at least 6 months with their employer. 771 [875] We consider the approach taken to 20-year-olds under the General Retail Industry Award is reasonably easy to understand and administer and provides a fair arrangement under which people can accept a discounted wage in order to improve their competitiveness while they develop competence. We have decided it would be fair to apply the same mechanism to provide discounted rates for inexperienced 18-, 19- and 20-year-olds, for any period in which they have less than six months’ experience with the employer, for each of the three awards. We consider the fairest way to do this would be by reference to the current proportions (70%, 80% and 90%) to best balance competitiveness with both younger and older people. Persons of junior employee age not covered by the Fast Food Industry Award but working in senior roles in the fast food industry [876] Before turning to the next limb of our consideration of the two objectives, we will address a further issue raised in respect of fairness. The Ai Group submitted that there could be people of junior employee age employed in more senior roles not covered by the Fast Food Industry Award. It submitted such persons would be award/agreement free and therefore covered by the special national minimum wage for junior employees. It submitted that if young adults were paid adult rates under the Fast Food Industry Award, the result could be an anomaly where a 20-year-old employed in a role too senior for the award might be entitled to less pay than a 20-year-old employed under one of the award classifications.772 It submitted it would be incongruous that there would be justification for the abolition of those [award] junior rates in those circumstances.773 No actual employee in this situation was identified. The SDA pointed out that very few people are actually paid according to the National Minimum Wage Order.774 We do not accept the Ai Group’s submission. First, it is unremarkable that award rates may differ from rates under the National Minimum Wage Order. Next, this argument seems somewhat inconsistent with the argument that young adults’ work is of less value than that of people aged 21 and older. Most importantly, if a hypothetical young person is in a managerial 771 The General Retail Junior Rates (20-year-olds) decision, [171]-[172]. 772 PN4962-PN4963. The Ai Group handed up a copy of the 2025 National Minimum Wage Order in support of this submission. 773 PN4963. 774 Citing Annual Wage Review [2024] FWCFB 3500, [28]. [2026] FWCFB 75 232 or executive role of sufficient seniority that it is outside the classifications in the award they have presumably been appointed because they can perform that job with the same work value as anyone else, and likely have greater bargaining power and lesser labour market disadvantage than, for example, minors or inexperienced people of their own age. In those circumstances it seems unlikely that the hypothetical employee would be paid the minimum wage. Employers are not prohibited from paying people above the minimum. Fairness in relation to other employees covered by the same award [877] As indicated above, fairness is to be assessed from the perspective of the employees and employers covered by the modern award in question.775 The MGA raised an issue about workplace harmony, with regard to how employees other than juniors, in the same workplace, might react to an increase in junior rates. The MGA submitted:776 “An often-overlooked aspect of changing wage rates for junior employees is workplace harmony. Maintaining workplace harmony is a vital part of running an efficient and effective business and creating an environment where employees can function to a high level with positive morale. If junior rates were removed for employees above the age of 18, there could be situations where employees that have little to no experience are earning the same amount as an employee who has been engaged in the role for some time. For example, an 18-year old who is hired to perform their first job could be paid exactly the same amount as a 21- year old colleague who has been performing the job for three years (and who, under the current system, has only just reached the full rate after gradually progressing). Situations like this have the potential to cause resentment or morale issues among older staff members who feel as though they had to work their way into a position with higher pay through time on the job. On the other hand, being paid the same rate as an older, more experienced employee may place unrealistic performance expectations on younger employees who may feel as though they are not of the same value to their employer as the older employee with more experience.” [878] Mr Bongiovanni expressed similar concerns in his evidence.777 On the other hand, some of the SDA lay witnesses expressed the view that it was unfair that they were getting paid less than older employees to do the same job.778 JH recalled telling his friends: “…it’s an absolute stitch-up that I’m the third most experienced person in the department, and I'm getting paid less than people who are older than me. I do more work than them and I've been here longer."779 [879] Employees’ subjective perceptions as to whether their wages are fair or deserved relative to others’ are of limited utility to us in assessing whether the awards provide for fair 775 Real Estate decision, [54]. 776 MGA’s outline of submissions, [53]-[55]. 777 Exhibit 118, statement of Mr Bongiovanni, [38]-[42]. 778 Exhibit 15, statement of KB, [68], Exhibit 18, statement of RB [53], Exhibit 22, statement of BCA [18], Exhibit 23, statement of DC [27], Exhibit 36, statement of JH [37]. 779 Exhibit 36, statement of JH, [37]. [2026] FWCFB 75 233 minimum wages for junior employees. Nonetheless, we observe that continuing to provide junior rates for minors, and for inexperienced young adults for a reasonable period of time, while providing that young adults generally receive adult rates, strikes a balance between these competing perceptions that promotes both harmony and fairness. [880] We wish to address one other matter in relation to other employees employed under the three awards. As we have indicated elsewhere there are other special rates under the three awards, including in relation to the supported wage, and the training wage. Varying the junior rates provisions will not affect other special rates, though relativities will change. Likely impact on business s 134(1)(f) [881] As indicated above, the concept of “fairness” in the context of both the safety net generally and minimum wages for junior employees takes into account fairness to employees and employers. The substantial fairness issue for employers related to their costs. Section 134(1)(f) requires us to take into account the likely impact of any exercise of modern award powers on business, including on productivity, employment costs and the regulatory burden in setting a fair and reasonable safety net. In considering fairness and reasonableness, we can do so having regard to “the perspectives of employers and employees and the contemporary circumstances in which an award operates.”780 Employment costs [882] The SDA submitted that the other experts had agreed with Prof Borland as to the estimated impacts on employers’ costs of potential increases to minimum wages for junior employees,781 and made submissions as to particular points of difference, which we have referred to below. It submitted the evidence from the employer lay witnesses as to the financial impact of the proposal was limited and unconvincing.782 [883] Ai Group submitted that the impact on employment costs would be significant, relying on Professor Lewis’s evidence, which we have set out below. They pointed out that labour costs for junior employees would increase to a greater extent than total labour costs, and that firms that employed junior employees would be affected to a greater extent than firms that did not. They relied on their witnesses’ financial evidence to say that the costs of the variations, if made, were dramatic. It said the variations would threaten some businesses’ viability, with consequences for employment.783 [884] Ai Group also submitted that the fast food industry employs significant numbers of junior employees. It submitted increasing the junior rates of pay would have a major impact on their profitability and would make many unviable.784 It said this was supported by, inter alia, the following matters:785 780 Penalty rates judicial review decision, [49] and [53]. 781 SDA’s closing submissions, [196]. 782 SDA’s closing submissions, [138]. 783 Ai Group’s outline of submissions, [33]. 784 Ai Group’s outline of submissions, [53]. 785 Ibid. [2026] FWCFB 75 234 “(a) the employer witness evidence shows that the fast food industry is a tough industry in which to make a profit. It largely operates on a high-volume model where stores need to sell a lot of food, with a low margin on sales to make a profit; (b) during recent years, the fast food industry has also been experiencing constant cost pressures through higher rent, electricity, food, utility and other input costs; and (c) in the experience of fast food businesses, they have little or no ability to pass on any significant increases in wages through price increases to customers. This is because their experience shows that customers, particularly those outside the inner city regions, will substitute their purchasing of fast food with other cheaper alternatives if there are any substantial price increases for their products. In short, customers would reduce their demand for fast food.” [885] The Ai Group then made submissions as to the effects on small business particularly given the franchised nature of the fast food industry. They also made reference to impacts on employment in rural and regional areas.786 We have dealt with those submissions in our consideration of employment impacts, above. [886] The ARA submitted787 that having regard to the typically low profit margins amongst retail businesses, the increase in costs resulting from the proposed variations would likely lead to business closures, job losses and an increase in automation that would lead to further job losses. They also made submissions as to impacts on regional small businesses, and rural and regional businesses. [887] The MGA submitted the SDA’s proposed variation to the General Retail Industry Award would, if made, impose significant new wage costs on retailers who were already facing a cost-of-doing-business crisis, jeopardising the financial viability of many independent retailers. It submitted small, independent businesses were struggling to stay in business. Adding further financial pressure on these businesses would force many to consider drastic operational changes, including the closure of their business. This submission was not reflected in their evidence; their witnesses explained why they thought increasing prices would not be viable but none said the variations if made would force them to consider closing their businesses. [888] The MGA also submitted that independent retailers would be more heavily affected than larger chains in grocery and hardware sectors, operated on slim profit margins, and recently had to deal with other costs increases. It submitted that independent retailers would likely respond to increases in costs by changing staffing arrangements. However, if they did raise prices that would affect Australian consumers.788 [889] Having considered those submissions, we make the following findings. [890] Changes to the junior rates provisions of the three awards would not have direct effects on the wages payable by all businesses across the economy, but would have direct effects on 786 Ai Group’s outline of submissions, [55]. 787 The ARA’s closing submissions, [4(e)]. 788 MGA’s outline of submissions, [14]-[18]. [2026] FWCFB 75 235 businesses within the general retail, fast food and pharmacy industries covered by those awards, that employ junior employees aged 18 to 20. [891] The variations would affect those businesses by changing the rates actually paid, or by changing the minimum wages that would be taken into account when the Commission is considering whether an enterprise agreement meets the “better off overall test.” As to potential indirect effects, we heard evidence as to potential spillover effects beyond the businesses immediately affected. [892] The expert witnesses gave evidence as to the likely effects on labour costs if the application was to be granted. The opinions we have summarised below assumed the variations sought would be granted in full. Altering minimum wages for junior employees to a lesser extent than sought by the SDA would reduce impact on total costs. [893] Prof Borland gave the following opinions regarding the three awards, in his first report: • “In my opinion, taking into account my calculation of the upper bound impact of the increase in junior minimum wage rates on total costs and what I predict would be a small impact on the level of employment, there would be a small impact on total costs from the increase in junior rates in the [General Retail Industry Award] proposed by the SDA. The impact may vary somewhat from my upper bound calculation of an increase of 0.34 per cent, depending on whether employment decreases or increases due to increase in junior rates and depending on the extent of offsetting factors and wage spill-overs. But the magnitude of that difference is likely to be small, and hence does not affect my opinion that the impact on total costs would be small.”789 • “In my opinion, taking into account my calculation of the upper bound impact of the increase in junior rates on total costs and what I predict would be a small impact on the level of employment, there would be a moderate impact on total costs from the increase in junior rates in the Fast Food Award proposed by the SDA. The impact is likely to be lower than my upper bound calculation of an increase of 3 .82 per cent. This is for two reasons. First, offsetting factors, such as lower employee turnover, are likely to reduce the extent to which the increase in junior minimum wage rates translates into higher labour costs; whereas the influence of wage spill-overs within the industry are likely to be minimal due to such a large proportion of the workforce being directly affected by the minimum wage. Second, where employers substitute for junior employees who receive the increased minimum junior wage rates, that will have the [effect] of lowering the increase in total costs relative to the benchmark scenario.”790 • “In my opinion, taking into account my calculation of the upper bound impact of the increase in junior rates on total costs and what I predict would be a small impact on the level of employment, there would be a small impact on total costs from the increase in junior rates in the Pharmacy Award proposed by the SDA. The impact may vary somewhat from my upper bound calculation of an increase of 0.40 per cent, depending 789 Exhibit 1, Borland principal report, [70]. 790 Exhibit 1, Borland principal report, [93]. [2026] FWCFB 75 236 on whether employment decreases or increases due to the increase in junior rates and depending on the extent of offsetting factors and wage spill-overs. But the magnitude of that difference likely to be small, and hence does not affect my opinion that the impact on total costs would be small.”791 [894] Prof Lewis said the following in relation to costs for the retail industry:792 “Recalculation of Prof Borland’s estimates confirm total costs for the Retail industry would be expected to rise by a relatively small percentage amount due to increasing youth wages (0.34 or 0.59 percent). This still amounts to $195 million or $338 million (depending on the labour measure adopted) per year. The increase in total labour costs (the only thing that can be controlled by businesses) would rise by a greater 2.3 or 4.4 percent. The increase in labour costs which would cause businesses to adjust (junior workers) would increase by a much bigger percentage, about 22 percent. This is far from trivial and would be expected to result in significant labour adjustment. It is worth emphasising that the above calculations are for changes in costs for the industry. Changes in cost will differ for individual businesses within the retail industry. About half of all businesses in the industry do not employ any workers and it is likely others do not employ any juniors. This means the actual percentage increases in labour costs will be greater than the estimates above suggest for most firms in the industry that actually employ juniors. The impacts of changes in junior wages on businesses can only be determined by knowing the distribution of junior employees across businesses by such factors as firm size, type of sector of the industry, hours of total employment and employment of juniors by age.” (emphasis in original) [895] As to costs in the fast food industry, Prof Lewis said:793 “For the Fast Food industry, I have recalculated Prof Borland’s estimates of cost increases due to proposed changes in awards. The results imply that that although total costs for the industry would be expected to rise by a relatively modest, but significant, percentage due to increasing youth wages (3.8 or 4.75 percent) per year, this still represents an immediate monetary increase in costs of $4,182 million or $5,227million. The increase in total labour costs (the only thing that can be controlled by businesses) would rise by a greater 11.9 or 14.7 percent. The labour which would cause businesses to adjust (junior workers) would increase by a much bigger percentage, about 22 percent. These numbers are far from trivial and would be expected to result in significant labour adjustment immediately after a pay rise and continue over a period of time. To the extent that businesses are forewarned of an increase in award wages, some adjustment would be expected to take place in anticipation of the award changes. 791 Exhibit 1, Borland principal report, [106]. 792 Exhibit 77, Lewis report, [8]-[9]. 793 Exhibit 77, Lewis report, [17]-[19]. [2026] FWCFB 75 237 In terms of impact on industry performance, these increases in total labour costs would reduce operating profit by about a half and industry value added by about 11 percent. This would be a major impact on financial performance of many businesses in the industry requiring reallocation of labour and/or the need increase prices. It is worth emphasising again that the above calculations are for changes in costs for the industry. Changes in cost will differ for individual businesses within the Fast Food industry. About 31 percent of all businesses in the industry do not employ any workers and likely others do not employ any juniors. This means the actual percentage increases in labour costs will be greater than the estimates above suggest for most firms in the industry if they actually employ juniors. The impacts of changes in junior wages on businesses can only be determined by knowing the distribution of junior employees across businesses by such factors as firm size, type of sector of the industry, hours of total employment and employment of juniors by age.” (emphasis in original) [896] Prof Lewis was not asked to consider Prof Borland’s estimates for the community pharmacy industry in his report. [897] Prof Holden agreed with Prof Borland’s approach and his calculations. He provided opinion, in his report, as to the impacts of increased costs on business in each of the general retail and fast food industries. The admissibility of this evidence or, if admitted, the weight to be given to it, was contested. Prof Holden had not been asked to deal with the community pharmacy industry in his report. [898] Dr Hyslop also accepted Professor Borland’s calculations of the estimated impacts on employers’ costs of potential increases to youth wages in the Awards. The ARA drew our attention to his observation that recent New Zealand hospitality industry research had found that while small minimum wage increases were largely absorbed by firms, responses to larger increases led to reduced hours, lower hiring and higher expectations of regular employees, higher prices and closing some outlets (by hospitality employers).794 The objection to parts of Prof Holden’s report [899] The SDA filed and served on other parties an objection,795 supported by a short submission, in respect of Professor Holden’s evidence. The objection related to several parts of the expert report of Professor Holden796. The SDA contended that the parts of the Holden Report797 to which it objected should not be admitted, or if they are admitted, should be given no weight. Some of the paragraphs to which the objection applied related to Prof Holden’s opinions as to the impacts of the variations, if made, on profit.798 Some related to Prof Holden’s 794 Exhibit 85, Hyslop supplementary report, [33], citing Houghton, Rosalind. 2012. "Employers' Perspectives-Part Two: The Minimum Wage System." Wellington, NZ: Ministry of Business, Innovation & Employment. 795 SDA objection to parts of the expert report of Professor Richard Holden filed 29 October 2025. 796 Including paragraphs [33], [36], part of [60], and [61] of Exhibit 80, the Holden report. 797 Which it set out in Annexure A of the SDA’s submissions on the objection to exhibit 80. 798 Objections to paragraphs [33], [43], [58], part of [60], and [68]. [2026] FWCFB 75 238 opinions as to the consequences of the impacts of changes in profits.799 The SDA argued that these opinions consisted of bare assertion, did not identify any factual basis for the opinion held, and failed to contain any path of reasoning. It submitted that the Commission had, rightly, declined to attach any weight to expert opinions where the basis for those opinions was not expressed.800 It submitted Prof Holden’s opinion was unsupported by any path of reasoning, or evidence, and could safely be disregarded. [900] The ARA submitted that we should not accede to the SDA’s objections. It argued we were not bound by the rules of evidence, and that though the rules of evidence provided a good starting point as to whether it was fair and appropriate to receive evidence, there was no unfairness resulting from the approach adopted by Prof Holden’s report. It submitted the SDA had not sufficiently identified the alleged deficiencies in the impugned parts of the Holden Report. It submitted that read in context the factual basis and path of reasoning are identified in the report. In particular the ARA referred us to paragraphs it said provided the evidentiary basis and/or reasoning for paragraphs 33, 43, 58, and 68 of Prof Holden’s report. It submitted the bases for the SDA’s objection to the other paragraphs cited in its submissions on the objection were not properly articulated. The ARA submitted the SDA had had ample opportunity to require the production of the information or documents and had not been deprived of the opportunity to test Prof Holden’s evidence. It said the SDA’s objections were unnecessarily technical and formal, in circumstances where no prejudice has arisen. On the basis of those submissions, it submitted we should be slow to accept the SDA’s objections. [901] We accept that we are not bound by the rules of evidence, that we must act fairly and we must have regard to probative evidence. We have considered the relevant objections on that basis. [902] As to the impacts of costs on profits, Prof Holden took the costs increases estimated by Prof Borland, relied on two named sources to find an “average profit margin” in general retail and an EBIT margin in fast food, and then applied a formula to estimate the change in the two margins having regard to the costs. [903] We consider the path of reasoning for the general retail industry appears at paragraphs [28] to [34] and for fast food, the corresponding paragraphs at [56]-[59], of Professor Holden’s report.801 [904] However, we consider Prof Holden’s conclusions about specific impacts on profits should be treated cautiously, because of the factual foundation for the figures used for the average profit margin (in general retail) and the EBIT margin (in fast food). • For general retail, Prof Holden gave an example, that average margins in the category “Food and Liquor” (which he said was an example relevant to supermarkets such as Woolworths, Coles, and IGA) are just 4.7%. He cited his source as “MST Marquee data provided by the Australian Retailers Association…” and gave a URL. This source 799 Objections to paragraphs [36], [44], [61], [69]. 800 Citing, for example, Re Horticulture Award, [153], which had cited 4 yearly review of modern awards – Social, Community, Home Care and Disability Services Award 2010 [2021] FWCFB 2383. 801 Exhibit 80. [2026] FWCFB 75 239 was an article from the ARA’s then website802 which provides the view of “MST Marquee” as to the benchmark average profit margins in various categories including food and liquor. 4.7% was the lowest of the margins referred to. The article is not a peer-reviewed journal article. It was published by one of the parties. No author from MST Marquee was called to give evidence. There was no explanation as to why actual profit margin data from the ARA’s supermarket members was not used. • For fast food, Prof Holden cited an EBIT margin of 8.04% in relation to Collins Foods, which operates franchised KFC and Taco Bell restaurants in Australia. No employer lay witnesses gave evidence on behalf of Collins Foods, or the owner of those brands. The ARA’s bundle of materials relied upon by Prof Holden included a copy of the Collins Foods annual report. We would be reluctant to rely on the Collins Food EBIT margin as being “likely comparable to others in the industry,” especially given the variation, on the face of the report, between margins in the KFC Australia and Taco Bell sides of the same business: for the KFC Australia part of the business, the annual report showed revenue had grown 6.6% but EBITDA (a measure similar but not identical to EBIT) had increased by 9.8%, with an underlying margin of 19.8%. On the other hand, the underlying EBITDA for the Taco Bell part of their business was negative.803 [905] On the other hand, we can accept as a matter of mathematics that if an employer has to bear the full amount of an increase in labour costs, with all else held equal including no change to revenue, there will be a corresponding negative effect on its EBIT margin, the magnitude of which would depend on the ratio of total costs to revenue. [906] As to the impacts of changes to profits, we accept that Prof Holden did not give a path of reasoning as to his assertions that the consequences would likely include, in general retail, business closures, job losses, and an increase in automation that would lead to further job losses, or, in the fast food industry, significant business closures, significant job losses, and an increase in automation that would lead to further job losses.804 We give these general assertions as to likely consequences little weight in the absence of the path of reasoning, but the expert evidence did canvass several issues in respect of likely business responses to increases in minimum wages, to which we now turn. Employment effects [907] We have discussed at length, above, the potential effects of increases in labour costs on employment. If firms respond to higher minimums through managing their employment costs via reductions in employment or changing to lower-cost bases of engagement, that will be an adjustment by which they seek to manage any impacts on their own profits. [908] For example, the SDA referred to Prof Lewis’ response to questions about whether one way employers could reduce costs would be to convert casual employees to permanent status (whether part-time or otherwise).805 RAFFWU made a submission to similar effect. The SDA 802 Notwithstanding the reference to ChatGPT in the URL that Prof Holden cited. 803 Collins Foods Annual Report 2024, 2 – 3, in Exhibit 81, Prof Holden’s bundle of sources. 804 Exhibit 80, Holden report, [36] and [61] respectively. 805 PN1680-PN1684. [2026] FWCFB 75 240 also referred to Professor Holden’s acceptance that one possible employer response to higher labour costs may be to reduce headcount—whether by not replacing departing workers or through using automation instead of hiring new workers—and broadly agreed that this would lead to fewer employees and therefore lower employment costs.806 Prof Holden had referred to job losses and increases in automation as being likely consequences of the increase in cost, in two of the paragraphs to which the SDA had objected. [909] However, seeking to manage employment costs is not the only possible response to increases in minimum wages payable to junior employees. The extent to which there are employment effects would be affected by factors, including other adjustments made by firms in response to the increased costs. We now consider the issue of adjustments, and other possible consequences of the proposed variations that may affect employment. Adjustments [910] The SDA submitted that Prof Holden had been asked to provide an opinion about the anticipated impact on employment costs and any further costs to business but had only modelled a scenario in which employers absorb the entire wage increase with no pass-through. It said the result was an analysis that overstates the cost impact on employers. Prof Holden was providing possible first round effects of increases to total costs on the basis all else were held equal. As to likely employer adjustments to defray cost increases, Prof Holden’s opinion was in general terms and did not advance the matter very far. We accept that generally employers are likely to respond to increases in costs by trying to reduce costs, increase revenue, or both. The means by which they might do this was in contest. [911] The MGA submitted that businesses would be likely to adjust to changes gradually and in stages. For example, they may initially absorb costs but may later decide to change staffing arrangements or refrain from opening new stores. It submitted longer-term changes are harder to capture in modelling.807 Professor Holden’s evidence was that long-run effects could be different to short-run effects.808 We accept that first-round effects of increases to labour costs are not the only effects, and that adjustments may play out809 over time. Pass-through to consumers via price increases [912] The expert evidence referred to potential “scale effects” if the variations were made. If increased costs are passed through via higher prices, that could mitigate employment effects. However, if higher prices led to decreased consumer demand, the employer may need less labour for production.810 [913] The SDA submitted that, in his first report, Professor Borland had adopted the assumption that there would be full pass-through absorption by employers of the proposed increases in junior rates, with no offsetting of increased labour costs by (for example) passing on costs as employers passed on the cost of increased wages to consumers in the form of 806 PN2039-41. 807 MGA outline, [83]-[86]. 808 PN2006, cross-examination of Prof Holden. 809 Language used by Prof Holden, PN535. 810 See Exhibit 1, Borland principal report, [17], [19], [23], [67], [90], [104]; Borland cross-examination, PN533; Exhibit 80, Holden report, [14], Holden cross-examination, PN2045-2046. [2026] FWCFB 75 241 increased prices. The employer experts also made this assumption. The SDA said that, however, as Professor Borland had observed, this assumption likely means that estimates of employment costs are an over-estimate.811 It said Professor Lewis had stated frankly that he did not think there would be an effect on profits because “employers are going to do something about it”.812 It submitted Professor Holden had accepted that firms act rationally and are profit maximisers and had agreed that when the cost of labour increases it was rational to assume that firms would “look at ways to offset that cost”.813 [914] The SDA submitted that a ‘major finding’ of the international literature is that employers in the retail and fast food industries pass through wage increases, to a large degree, as price increases.814 It submitted that Professor Holden had accepted that a possible employer response was to increase prices. It submitted that he had acknowledged that he had referred to this possibility in his report when discussing the ‘scale effect’.815 It submitted that under cross- examination, Prof Holden had agreed that his calculations did not account for the possibility that employers might increase prices to offset increases in labour costs,816 or for any other offsetting factor such as substitution. The lay evidence from employers in the fast food industry expressed strong reservations about the effect of price increases on consumer demand for fast food, albeit in general terms. The ARA submitted that the extent of firms’ ability to pass on costs was not clear, and that Prof Holden’s evidence had been that the degree of pass through to price increase was a contested area.817 [915] Relying on Mr Beattie’s (partly confidential) evidence818 as to the ability to raise prices, the Ai Group submitted that demand for fast food would reduce if prices were increased. A difficulty with Mr Beattie’s evidence is that he does not disclose the source of his knowledge or expertise allowing him to opine on the price elasticity of demand for McDonald’s products. Another difficulty is that his opinion does not state whether it relates to a scenario in which only McDonald’s raised prices, or in which many or all fast food industry firms raised prices in similar proportions. [916] We accept that the question of the extent to which firms can increase prices for their goods having regard to possible impacts on consumer demand (and flow on consequences for labour demand) is not straightforward. This informs our conclusion, above, that there is likely to be some negative effect on the employment of young adults in the three industries as a consequence of our decision to vary junior rates for young adults. 811 Exhibit 3, Borland reply report, [8]. 812 PN1609, and see PN1605. 813 PN2037-PN2038. 814 Referring us to the discussion on this issue by Professor Borland under cross-examination at PN417–28; and also to PN2053–2069. 815 PN2045. 816 PN2046. 817 PN2072, cross-examination of Prof Holden. 818 Exhibit 97, statement of Mr Beattie, [24]-[26]. [2026] FWCFB 75 242 Labour supply and reduced employee turnover [917] The SDA submitted that another finding from the minimum wage literature was that higher minima can reduce employers’ costs by reducing employee turnover.819 The SDA’s submissions also indicated that costs increases may be less than the outer bounds estimates because of a mitigating effect of reduced employee turnover. It submitted that Prof Holden had agreed that the literature examining minimum-wage effects includes studies that assess whether increases in minimum wages affect worker turnover. It said Prof Holden was taken to a study by Dube and Lindner (which the SDA said was otherwise cited in his report, although not in this respect)820 showing that lower worker turnover followed an increase in minimum wages.821 It submitted he had accepted that it was reasonable to assume that, where employee turnover is reduced, firms’ hiring and training costs will also be reduced.822 [918] It said he had accepted that “reduced turnover in the short term is good for firms in terms of training costs [and] learning by doing on the job,” and had agreed his estimates of impacts had not taken into account reduced turnover of employees.823 It submitted that Dr Hyslop had also accepted that one potential impact of higher wages was an increase in job tenure.824 [919] We accept that higher minimum wages are likely to increase labour supply and reduce employee turnover, and that this would benefit employers and assist in defraying increased labour costs. However, we do not make any finding as to the likely extent of these effects. Whether employers would bear the costs themselves in the form of reduced profits [920] We have dealt with Prof Holden’s views as to the potential impacts on profits above. We have considered the parties’ submissions about whether and to what extent employers can bear the increased labour costs through reduced profits. We make the following findings and observations. [921] First, initial impacts on profits based on a change in labour costs and holding all else equal are not final impacts and are of limited assistance given they do not take into account employer adjustments. [922] Next, the evidence before us does not put us in a position to make findings about the profit margins prevailing across each of the three industries generally, or in particular sections of those industries, or at a firm level. [923] The ARA lay evidence from Coles and Kmart Group did not provide profit margins or financial statements, even though Coles Group Limited, and the owner of Kmart Group, Wesfarmers Limited, are both publicly listed companies and publish their annual reports. 819 PN4690. 820 Exhibit 81, Tab 7. Arindrajit Dube and Attila S. Lindner (2024), ‘Minimum Wages in the 21st Century’, NBER Working Paper 32878, Table 5 https://doi.org/10.3386/w32878. 821 PN2080-82. 822 PN2079. 823 PN2078-83. 824 PN2218. [2026] FWCFB 75 243 [924] The two MGA lay witnesses operating independent grocers provided a small amount of general information about their finances, but not to the extent that indicates the likely effect on their own profits.825 The evidence does not go to the profit margins of independent grocers or liquor stores more broadly. [925] The Pharmacy Guild, as indicated above, put their case predominantly on the basis of a difference in work value rather than other considerations. Their lay witnesses’ evidence did not directly go to the issue of effects on profitability. [926] As to fast food, the lay witnesses provided varying amounts of detailed financial information about their businesses. Mr Beattie provided us, on a confidential basis, with his opinion of the EBITDA for McDonald’s restaurants operated by “McOpCo,” which is to say, McDonald’s itself (rather than under franchise/licence). His opinion as to the restaurants’ EBITDA was based on certain information and his historic knowledge from working with McDonalds for thirteen years. He told us that there were 1,052 McDonald’s restaurants of which 172 were owned and operated by McOpCo. He gave his opinion about profitability across all restaurants by extrapolating from McOpCo restaurants payroll data and opinion of the restaurants’ EBITDA. The SDA submitted his calculations contain errors, and that the supporting documents were unsatisfactory.826 We accept his calculations contained some errors, and that the supporting material provided was very limited, indicating a greater reliance on his general knowledge from his experience, rather than documents and data to which we or the parties could have regard. His knowledge related to the individual McOpCo restaurants, not the finances of McDonald’s Australia as a whole. [927] Though the SDA sought to cross-examine Mr Beattie in relation to the McDonald’s Australia Limited financial statements, he was not familiar with them. McDonald’s Australia Limited is a public company and we consider it likely its witnesses could have provided better evidence of its profitability and financial circumstances, such as the McDonald’s Australia Limited financial statements, just as it was able to provide its Corporate Social Responsibility report. [928] Mr Carrington, from Domino’s Pizza Enterprises Ltd, also did not provide financial statements. His statement referred to “low” profit margins but no magnitudes were provided. He agreed under cross-examination that he had not provided any detail about the profit margins in the business.827 [929] The witnesses from Craveable Brands did not provide financial information across the business. They also could have done so. Mr Humphreys, who operated Craveable Brands (specifically, Red Rooster), franchises, provided some confidential financial information about his family trust’s nine restaurants.828 In open hearing, we heard about whether Mr Humphrey’s business was at risk of liquidation, or of having to sell stores, if the variations sought were 825 Exhibit 74, statement of Ms Koch; cross-examination of Koch, PN1326-1367; Exhibit 75 (a confidential exhibit); Exhibit 117, statement of Mr Luchterhand; cross-examination of Luchterhand, PN4424. 826 PN4615. 827 PN2830-PN2832. 828 Confidential exhibit 103. [2026] FWCFB 75 244 granted.829 We have had regard to it. We also heard evidence as to why his business’s financial circumstances might be different to others’ with specific regard to a high loan-to-asset ratio. We have taken into account Mr Humphreys’ confidential evidence. [930] The CFO of Hungry Jack’s, Ms Bletsas, took a sample of ten restaurants to calculate likely impacts on costs and EBITDA for restaurants. She said they had a variety of high and low margin restaurants. The increase would lower their overall profitability and likely move low margin stores into loss making, thereby increasing the possible closure of restaurants. The SDA submitted the company could have provided full reports rather than information about a sample of stores.830 On the basis of Ms Bletsas’ responses during cross-examination831 we are cautious about accepting that the sample is a representative one, such that it can be used to draw inferences about the whole business’s finances, or the circumstances of its restaurants generally. We accept that Hungry Jack’s could have provided, but did not provide, its company financial statements. [931] To the extent the lay witnesses provided evidence about impacts on profits, they did so on the basis of the employer absorbing the additional costs. Though witnesses referred to the sort of adjustments that might subsequently be made (e.g., closing unprofitable outlets), they did not provide specific modelling in that regard. [932] In light of the foregoing we do not make findings as to the specific likely effects on profits of businesses across the three industries. Save for a small number of fast food restaurants in respect of which evidence was provided on a confidential basis, we are unable to have a clear picture of likely effects on profits. [933] Because that evidence focussed on the restaurants operated under fast food firms’ brands, it did not go to the profitability of the large fast food firms as a whole. The evidence indicates there is a high degree of franchising and licensing in the industry. Whether the evidence relates to the profitability of franchised restaurants, or of restaurants operated by the fast food company directly, we cannot safely infer from it the likely profitability of the franchisor, which is to say, the fast food firm itself. It is self-evident that franchisors’ revenues and therefore profits might be affected by, inter alia, franchise and licensing fees, along with any other revenue streams a company has established. [934] We accept the following: • increases to minimum wages payable to employees in the three industries will increase labour costs if the current employment mix (both as to age and basis of engagement) is maintained; • we accept Prof Borland’s evidence as to the likely magnitudes of increases in costs; • the proportionate size of the increase in labour costs will be greater in industries and firms that employ more junior employees; • the effect of the increase in labour costs on profit margins at first instance will vary across firms (including across franchises/licenced restaurants); • employers will seek to make adjustments in response to the increase in costs; 829 PN4614. 830 PN4616. 831 PN2922. [2026] FWCFB 75 245 • we do not have any basis to find that the three industries or that firms generally within those three industries lack capacity to pay for the proposed variations, though we accept that some restaurants are more profitable than others, and those already operating at or close to a loss will likely be less able to bear increases in labour costs; • in any event for the reasons above we have decided that fairness favours confining the variations to young adults, which means that costs impacts will be less than anticipated by the parties’ expert witnesses, and to spread changes over time. Small business, and rural and regional employers [935] One of the means by which the Fair Work Act’s object is given effect is by acknowledging the special circumstances of small and medium businesses (s 3(g)). The Ai Group submitted most fast food franchisees are small businesses. The term “small business” has different meanings in different contexts. The Fair Work Act defines “small business employer” essentially as having fewer than fifteen employees, but there are other common meanings (such as in relation to turnover, for taxation purposes). The ABS considers small businesses are those with 0-19 persons employed and medium sized businesses are those that have 20-199 persons employed. [936] The fast food chains did not provide us with a great deal of quantitative evidence as to the number of employees on average per franchise: • Mr Carrington told us a typical Domino’s store would have three to five in-store employees, plus 10 to 15 delivery drivers, plus supervisors and managers.832 • Mr Beattie’s evidence suggested that the average McOpCo restaurant may employ 120 staff.833 Mr Turner told us that McDonald’s and its franchisees employed 115,176 employees in restaurants, and there were 1035 restaurants.834 This is more than one hundred employees per restaurant on average. Of course, the nature of an average is that some will have fewer, and some will have more. • Mr Humphreys’ family business employed between 40 and 45 managers835 plus 215 non-manager employees;836 • Ms Bletsas gave a sample of ten Hungry Jack’s restaurants, with a total of 582 employees in total for all ten. She also gave employee numbers per restaurant varying from 31 to 90.837 [937] Those witnesses whose businesses had operated franchises had operated multiple restaurants (Mr Carrington had owned 6 before moving to a role in the corporate franchisor, Mr Humphreys’ family trust owned 9). The Collins Foods annual report to which Prof Holden referred us indicated that a single corporate entity operated hundreds of franchises. We also had limited information about turnover per restaurant or per franchisee. We can extrapolate from some of the confidential data that it is likely that at least some restaurants have an annual turnover of less than $10 million. 832 Exhibit 94, statement of Mr Carrington, [8]-[9]. 833 Exhibit 97, statement of Mr Beattie, [20], [23]. 834 Exhibit 104, statement of Mr Turner, [5], [7]. 835 PN3422. 836 PN3432. 837 Exhibit 95, statement of Ms Bletsas, [29]-[30]. [2026] FWCFB 75 246 [938] We do not find on the state of the evidence that “most” franchises are operated by small businesses, but we consider it likely that some franchises will be operated by small or medium businesses having regard to the Fair Work Act and ABS definitions. We also observe that a proportion of employers within the coverage of the three awards but outside franchising would be small or medium business employers. [939] We accept the submission that firms with no employees are unlikely to be acutely affected by any variation to minimum wages for junior employees.838 [940] The ARA submitted839 that as regional small businesses are particularly susceptible to economic shocks, have lower survival rates, more volatile revenues and are generally less resilient than larger businesses, the impact of the proposed changes would be expected to have a much more undesirable effect on rural and regional businesses than metropolitan businesses. [941] The MGA submitted that focussing on industry-wide effects of the changes masks the acute pain at the individual business level, particularly for small enterprises employing a high proportion of junior employees. This would affect family incomes for family-run businesses, with a greater impact on those with smaller profit margins.840 [942] The MGA also submitted that its members provide an essential service to the members of their community, and many are the lifeline of that community. It submitted that if these businesses ceased operating, communities may lose more than a source of price competition. They would also lose opportunities for entry-level employment. It said young people engaged in meaningful work enjoy the respect they earn through the work they perform and their contribution to the community, leading to a healthier community with fewer anti-social behaviours.841 [943] We accept that the size of the business is not determinative of the effect of the variations on the business, and that the effect would likely be different as between firms (and restaurants) with a different employment mix (by age),842 as well as other factors.843 Generally we consider that any businesses, including small to medium businesses, whose business models depend heavily on hiring junior employees on rates below the adult minima will be affected by changes to junior rates to a greater extent than businesses less reliant on such labour. We also accept that uniform minimum wages do not necessarily have uniform effects across different geographic areas. Conclusion – employment costs [944] As is the case with every increase to minimum wages we expect labour costs to increase as a consequence of our decision to increase minimum wages for junior employees aged 18 to under 20 (under the General Retail Industry Award), and for all junior employees aged 18 and 838 SDA closing submissions, [208]; see also Exhibit 77, Lewis report, [9] and [19]. 839 ARA closing submissions, [4(e)]. 840 MGA submissions, [21]-[22]; [78]-[82]. 841 MGA submissions [33]-[36]. 842 Ibid; ARA closing submissions, [13]. 843 ARA closing submissions, [13]. [2026] FWCFB 75 247 over under the other two awards.844 One significant difference in this case is the size of the increase, particularly for 18-year-olds. Another is that the nature of junior rates means firms will have some different adjustment options to consider, such as greater substitution between ages, in deciding their response to any increases. Another is that, as we have indicated in these reasons, we intend to have transitional arrangements apply over a number of years. [945] We have dealt with firms’ potential adjustments, to respond to labour costs, above when considering the potential employment effects of the proposed variations. This is an issue that is raised in the context of the impacts on business, as the two issues – the impacts on business, and the impacts on employment – are closely connected. On the evidence before us we do not find that all, or any particular proportion, of the increased labour costs would be passed on to consumers by way of price increase. We do not find that firms’ adjustments would necessarily include price increases. We find that firms would consider price increases amongst the options for adjustment to increased labour costs. We make commensurate findings as to other potential adjustments. We do not find that any particular adjustments would necessarily, or universally, be made across all firms in all three industries. Having regard to the expert evidence we consider that pragmatic, rational, profit-maximising firms will consider all the options available to them in light of the circumstances of their own business and industry and make adjustments that make the most commercial sense. Productivity [946] Our observations as to productivity are set out above in the context of work value. We have also taken productivity into account in considering the modern awards objective. Refraining from altering rates for minors may mean they are less likely to be displaced by productivity-enhancing technological change.845 Aside from that observation, altering the minimum wages for young adults appears to us likely to have a largely neutral effect on productivity. We have taken the view, having regard to the lay evidence, that productivity is not homogenous across all individuals of the same age. It appears to us that absent the price advantage, employers will take an individual employee’s performance and productivity into account to the same extent regardless of whether the employee is 18 or 21, and at the same time the replacement of less-productive employees will not be frictionless. Regulatory burden [947] As to the regulatory burden, the SDA argued it would be mitigated for the business paying award rates, as there would be fewer rates and less complex pay arrangements. The Ai Group submitted this submission was overstated and not supported by any evidence, as well as being contrary to Ms de Witte’s evidence.846 It submitted there would be no material effect on simplicity or ease of understanding. We consider that having fewer age-based rates would be simpler. But for the reasons we have set out in this decision there is a sound basis for having smaller, incremental changes for minors. We also consider age-based rates should be continued for young adults who are inexperienced, on the basis that we consider it likely that labour market disadvantage decreases with age. 844 Subject to the arrangement for inexperienced junior employees referred to elsewhere in this decision. 845 Having regard to Prof Lewis’s opinion, Exhibit 77, [15]. 846 At Exhibit 92, statement of Ms de Witte, [19]. [2026] FWCFB 75 248 Other potential impacts on business – share prices and shareholders [948] Prof Holden raised other potential impacts on businesses, connected with his views as to impacts on profits. He considered the impacts on profits would likely have implications for share prices (and, relatedly, market capitalisation), and therefore on shareholders, including superannuation funds. The SDA objected to these parts of Prof Holden’s report. We consider the path of reasoning for the assertions briefly shown, in that Prof Holden makes assertions about impacts on profits, and connects them with potential impacts on share prices and shareholders. He gives the basis for his assumption that a change in share price would be proportionate to a change in profits, saying that would be the case if market prices reflected a standard discounted cashflow model. The factual basis is the same factual basis as the assertions about profits, namely the MST Marquee article and the Collins Foods annual report. We consider these parts of the report can be admitted. [949] However, we give these parts of the little weight for the following reasons. The issues relating to the assessment of likely impacts on profits, set out above, also apply here because this part of the report shares the same factual foundation and arises from the same reasoning. These parts of Prof Holden’s opinion were also very broad. He referred to a hypothetical supermarket using the EBIT ratio he had derived from an ARA source (referred to above) as an example, as well as referring to Collins Foods. We accept that some of the large firms in each of the general retail and fast food industries are operated by listed public companies. No quantitative data was provided as to past impacts of increases in costs, or changes in profit margins, on the share prices of the firms that were actively involved in these proceedings or of firms in these industries generally. The assessment of the impact of changes in profits on share prices was contingent on market prices reflecting a particular model but there was no further explanation as to whether Prof Holden thought that was likely, and, if so, why. On the various employer groups’ arguments, many firms in each of the two industries are not listed public companies. Hungry Jack’s is a large proprietary company. We have qualitative evidence before us that the majority of restaurants in the fast food firms that participated in these proceedings are employed in franchises. We do not have evidence as to what proportion of fast food industry franchise operators are firms with publicly-traded share capital (though Prof Holden tells us that Collins Foods is publicly listed) and we would anticipate that family businesses operating a small number of restaurants are unlikely to be public companies. Franchise operators with a small number of stores or restaurants are unlikely to have traded share capital. [950] Having regard to these matters, we consider these parts of Prof Holden’s opinions to be contingent on opinions regarding profits that we have treated cautiously, in very general terms, and remote from the likely impacts for non-publicly-traded companies within the two industries to which he refers. We have dealt with this line of argument further, below, in the context of our consideration of likely economic impacts. [951] We will now turn to national economic considerations, for the purposes of ss 284(1)(a) and 134(1)(h). [2026] FWCFB 75 249 National economic considerations: ss 284(1)(a) and 134(1)(h). [952] Under section 284 of the Fair Work Act, the Commission must establish and maintain a safety net of fair minimum wages, taking into account the performance and competitiveness of the national economy, including productivity, business competitiveness and viability, inflation, and employment growth. Under section 134, the Commission must ensure that modern awards, together with the National Employment Standards, provide a fair and relevant minimum safety net of terms and conditions, taking into account the likely impact of any exercise of modern award powers on employment growth, inflation and the sustainability, performance and competitiveness of the national economy. In the Annual Wage Review 2025 Decision, the Expert Panel approached the consideration of subsections 284(1)(a) and 134(1)(f) and (h) as follows:847 “Sections 284(1)(a) and 134(1)(f) and (h) express the economic considerations to be taken into account in different ways. Section 284(1)(a) expresses the overriding consideration to be the ‘performance and competitiveness of the national economy’, with ‘productivity, business competitiveness and viability, inflation and employment growth’ being a non-exhaustive list of elements of this consideration. Sections 134(1)(f) and (h) are concerned with ‘the likely impact of any exercise of modern award powers’ on the identified economic and business considerations. ‘Modern award powers’ include the variation of modern award minimum wage rates as part of the Review process: s 134(2)(b). In the context of this Review therefore, ss 134(1)(f) and (h) require us to engage in consideration of a predictive or speculative nature of the effects which might reasonably be expected to follow if a given outcome were determined. Section 134(1)(f) is concerned with the potential impact on ‘business’, with the productivity, employment costs and the regulatory burden of business being elements of this consideration. ‘Business’ connotes enterprises engaged in commercial or trading activity and is not apt to describe governmental functions. Section 134(1)(h) is concerned with the potential impact on ‘employment growth, inflation and the sustainability, performance and competitiveness of the national economy’. Unlike s 134(1)(f), the provision focuses on the aggregate, as opposed to sectoral, impact of an exercise of modern award powers. We structure our consideration of ss 284(1) and 134(1)(f) and (h) in the following way. First, we will outline the current and expected future performance and competitiveness of the national economy, with a focus on the specific matters identified in s 284(1)(a) and s 134(1)(h). Second, we will consider how, if at all, the outcome of this Review might affect national economic performance. Third, we will consider the likely impact of the Review on business. Because, as earlier discussed, the modern award-reliant workforce is substantially concentrated in a few industry sectors, our consideration of the potential effects on business will necessarily have a primary focus on those sectors.” [953] This means we are required to take into account the performance and competitiveness of the national economy in setting the safety net. It also means we have to take into account likely impacts of the variations, if made. The latter requirement requires prediction or speculation.848 The parties’ submissions focussed on this predictive or speculative 847 Annual Wage Review 2025 Decision, [24]-[25]. 848 Annual Wage Review 2025 Decision, [24]. [2026] FWCFB 75 250 consideration. Before turning to it, we will address the performance and competitiveness of the national economy for the purposes of s 284(1)(a). [954] We have taken a similar approach to subsections 284(1)(a) and 134(1)(h). We have dealt with subsection 134(1)(f) above. The performance and competitiveness of the national economy [955] Turning first to our consideration of the current economic conditions, we have taken into account that the Annual Wage Review 2025 Decision sets out the Expert Panel’s views as to the performance and competitiveness of the national economy, as well as various economic indicators obtained from various official sources.849 We adopt that consideration of the national economic circumstances at the time of that decision. We also take notice that there have been significant changes in economic conditions since the Annual Wage Review 2025 Decision. [956] First, we take notice that the inflation environment has deteriorated.850 The Statement by the Reserve Bank of Australia Monetary Policy Board of 17 March 2026851 noted inflation had picked up materially in the second half of 2025. The Board indicated, inter alia, that the conflict in the Middle East was giving rise to uncertainty. It also referred to the role of inflation expectations in giving rise to inflation risk. We have below considered the expert evidence was to whether the application, if granted, would affect wage and price inflation nationally, and we have accepted there would not be a significant impact on wage or price inflation. Professor Borland describes the likely impact on price inflation as “miniscule.” In addition, our decision to retain the current percentage rates for minors, and to phase in any changes, incrementally, over a long period, takes into account the current, changing inflation environment. [957] Next, we make the following observations about other aspects of the national economy: (a) The data in the most recent release in the series Australian National Accounts: National Income, Expenditure and Product,852 relating to GDP growth, GDP per capita growth, and real net national disposable income growth and productivity tend to suggest that by those measures the performance and competitiveness of the national economy have improved in the period since the Annual Wage Review 2025 Decision was handed down. However, we are conscious that conditions in relation to output and productivity are changeable and unpredictable, having regard to domestic and international conditions. (b) In considering the issue of business competitiveness, the expert panel in Annual Wage Review 2025 Decision expressed concern as to the change in real unit labour costs, which had grown by 2.3% in the 12 months to the December quarter 2024. The data in the latest release in the Australian National Accounts: National Income, Expenditure 849 Annual Wage Review 2025 Decision, [26]-[38]. 850 Australian Bureau of Statistics (February 2026), Consumer Price Index, Australia, ABS Website. 851 Reserve Bank of Australia, Statement by the Monetary Policy Board: Monetary Policy Decision, 17 March 2026, https://www.rba.gov.au/media-releases/2026/mr-26-08.html 852 Australian Bureau of Statistics (December 2025), Australian National Accounts: National Income, Expenditure and Product, ABS Website, released 4 March 2026, accessed 18 March 2026. [2026] FWCFB 75 251 and Product853 series also suggests this has been moderating, and in its March 17 statement the Monetary Policy Board noted that growth in unit labour costs had declined. (c) Though parties made submissions about the likely effect of the proposed variations on the viability of businesses in the retail, fast food, and pharmacy industries, which we have considered below, there was no submission as to whether business competitiveness and viability generally across the Australian economy had changed significantly since the Annual Wage Review 2025 Decision. (d) As to employment growth, the Annual Wage Review 2025 Decision relied on the Labour Force series to give the annual employment growth, at April 2025, as 2.7%, and the unemployment rate as 4.1%. The most recent release has employment growth as 1.8%, and the unemployment rate higher at 4.3%, both seasonally-adjusted.854 [958] Having made those observations, for the purposes of the mandatory consideration under s 284(1)(a), we now turn to likely impacts of the variations if made, for the purposes of considering s 134(1)(h). Likely impacts [959] As to the likely impacts on employment growth, inflation and the sustainability, performance and competitiveness of the national economy, the SDA submitted that the expert evidence established there would be miniscule or minimal effect on the economy or the labour market. [960] Prof Borland’s evidence was that the main potential impacts on national economic performance from an increase in the minimum wage would derive from the impact on wage inflation and the extent of pass-through of increased total costs to price inflation.855 [961] His opinion was that the increases in minimum junior rates in the General Retail Industry Award proposed by the SDA would have no significant impact on national economic performance. He estimated there would be a small impact on economy-wide wage inflation, 0.24 per cent in total, spread from the quarter when the increases proposed by the SDA were implemented to later time periods. He estimated a miniscule impact on economy-wide price inflation of 0.01 per cent. [962] For the Fast Food Industry Award, Prof Borland estimated the proposed changes would also have no significant impact on national economic performance. He estimated there would be a small impact on economy-wide wage inflation, 0.20 per cent in total, spread from the quarter when the increases proposed by the SDA were implemented to later time periods. He estimated a miniscule impact on economy-wide price inflation of 0.02 per cent. 853 Ibid. 854 Australian Bureau of Statistics (February 2026), Labour Force, Australia, ABS Website, released 19 March 2026, accessed 28 March 2026. 855 Exhibit 1, Borland principal report, [48]. [2026] FWCFB 75 252 [963] For the Pharmacy Industry Award, Prof Borland estimated the proposed changes would also have no significant impact on national economic performance. He estimated there would be a small impact on economy-wide wage inflation, 0.015 per cent in total, spread from the quarter when the increases proposed by the SDA were implemented to later time periods. He estimated a miniscule impact on economy-wide price inflation of 0.001 per cent. [964] The SDA submitted that Professors Lewis and Holden had accepted these calculations, and that these calculations had been undisturbed by cross-examination.856 However, Professors Lewis and Holden had taken issue with some aspects of Professor Borland’s opinions. Both raised the issue of spillover effects. Prof Holden also criticised Prof Borland’s method of adjusting the share of retail trade in the CPI when calculating economy-wide price inflation.857 [965] Prof Lewis’s opinion was that the data before him did not allow for any definitive conclusions to be made as to national economic impacts because there were too many variables at play.858 He said nonetheless some general outcomes could be surmised. He then made observations about inflation, output, and employment. He agreed that first pass-through impacts on price inflation would be small. On the other hand, he considered that if spillover effects gave rise to a general weakening of wage restraint, that would result in significant increases in wage and price inflation.859 Prof Holden’s view was that inflation impacts would not be significant, and that economy-wide inflation should not be the major focus.860 The SDA pointed out that Professor Borland’s report had taken into account the possibility of spillover effects.861 His reply report also dealt with this issue and explained that what was being assumed in his estimation was that the impact on economy-wide wage inflation from spillover effects to other industries was equal to 50 per cent of the size of the direct impact from the affected industry. He said this may imply a differential rate of growth in the wage rate to workers covered by the General Retail Industry Award and Fast Food Industry Award than other youth workers, but it did not imply that all other youth workers would now be earning less than those workers.862 [966] Prof Borland also addressed Prof Holden’s criticism regarding the share of retail in the CPI. He said his approach had relied on converting the increases in prices of retail industry and fast food industry employers into economy-wide price inflation. This had involved scaling the change for each industry sector by their respective shares of output, then adjusting because the industries were larger than the coverage of the General Retail Industry Award and the Fast Food Industry Award. He did this using hours worked as a proxy to adjust for the share of sector covered by the awards in their respective industries. Contrary to Prof Holden’s criticism, Prof Borland said that nothing in this process in any way relied on an assumption young people aged 15 to 20 years only worked in the retail/fast food industry.863 856 PN429-430. 857 Exhibit 80, Holden report, [40] and [65]. 858 Exhibit 77, Lewis report, [51]; see also PN1604. 859 Exhibit 77, Lewis report, [52]. 860 Exhibit 80, Holden report, [41]-[42], [67]. 861 SDA’s closing submissions, [265], referring to Exhibit 3, Borland reply report, [28]-[30]. 862 Exhibit 3, Borland reply report, [34]. 863 Exhibit 3, Borland reply report, [35]. [2026] FWCFB 75 253 [967] As to output and unemployment, Prof Lewis’s opinion was that the main factor in increasing GDP is increasing productivity, and that increasing wages for junior employees could lead to their being replaced by more productive technology. His view was that the effects of the changes on total employment and the unemployment rate would “not be great.”864 This stands to reason in light of the general consensus among most of the experts as to the likely effects on the employment of persons aged under 21 within the coverage of the three awards, which is a narrower inquiry. [968] The Ai Group submitted there was not likely to be a global macroeconomic effect on employment, making clear that was not the basis for their opposition to the application.865 [969] The ARA submitted that youth unemployment was high and that a fall in employment in young workers in the retail industry would have detrimental effects on human capital formation and increase inequity for some of the most disadvantaged people.866 It referred to Prof Lewis’s evidence as to the importance of youth employment. It also submitted that employment was important for reducing inequality for teenagers from low socioeconomic backgrounds, particularly in rural and regional areas.867 We have referred to these matters above in our consideration of fairness. [970] Professor Holden expressed a general view that the economy-wide impact of business closures was a major concern. This stemmed from his views as to the likely reduction in profits in general retail and fast food.868 Prof Holden made these general observations without seeking to quantify the proportion of businesses that would close, or identifying the potential economy- wide impacts of such closures; the paragraphs that followed related to firm-level impacts and impacts on those firms’ shareholders. The ARA submitted that potential impacts on share prices and shareholders (including superannuation funds) should be considered in the context of the likely impacts on the national economy.869 [971] As indicated above, the SDA objected to the admission of Prof Holden’s opinion regarding impacts on profits. We decided to admit the evidence and deal with it as a matter of weight. The SDA also raised objections as to the parts of Prof Holden’s report relating to share prices, market capitalisation, and superannuation funds. We have explained above why we are cautious in relying on Prof Holden’s opinion in relation to impacts on profits and impacts on business. As to whether we can assume broader national impacts in connection with potential impacts on share prices and related matters, we also consider Prof Holden’s evidence to be of little assistance. We will not repeat what we have said above, but we would add the following. We do not have before us quantitative evidence as to the proportion of junior employees in the fast food or general retail industries employed by companies with publicly-traded share capital. We do not have evidence as to what proportion of shares in listed companies operating in the fast food and general retail industries are owned by superannuation funds. We do not have evidence as to what proportion of listed companies operate businesses employing junior 864 Exhibit 77, Lewis report, [53]-[54]. 865 PN4925. 866 ARA’s closing submissions, [134], relying on Exhibit 77, Lewis report, [16], [55]. 867 ARA’s closing submissions, [135], relying on Exhibit 77, Lewis report, [30]. 868 Exhibit 80, Holden report, [43]-[44], [68]-[69]. 869 ARA’s closing submissions, [136]. [2026] FWCFB 75 254 employees who are within the coverage of the General Retail Industry Award or the Fast Food Industry Award. As indicated above, some of the lay witnesses were employed by businesses operated by public companies. They did not provide any evidence as to likely impacts of this application, if granted, on their own companies’ share prices, or as to the proportion of the shares in Wesfarmers, or Coles, owned by Australian superannuation funds. Prof Holden’s general opinion provides us with little assistance in considering section 134(1)(h). [972] Having regard to the foregoing and our discussion above as to employment, we consider the likely impacts of the SDA’s variations to junior rates, if made, on employment growth across the economy to be very limited. Effects on employment within the three industries are themselves minimal or small. The evidence suggests the potential for substitution and adjustments by firms to reduce employment impacts. Our decision to maintain rates in their current form for minors means that employment effects can be expected to be less than if the whole application were to be granted. Our decision to implement the changes to rates for young adults over time spreads any employment impacts over time. These matters go to employment rather than employment growth but the concepts are in our view connected. [973] We also find the variations if made would be unlikely to have a significant impact on wage or price inflation across the economy. Also, having regard to the expert evidence, we consider the variations if made would have no significant impact on national economic performance. Nothing before us suggested that there were likely material adverse impacts on the sustainability or competitiveness of the national economy. [974] Our decision to make variations that are more narrow than those sought will mean that any likely impacts are less than would be the case if the SDA’s variations were granted in full. Workforce participation (ss 284(1)(b), 134(1)(c)) [975] Under the minimum wages objective, the Commission must establish and maintain a safety net of fair minimum wages, taking into account promoting social inclusion through increased workforce participation.870 The modern awards objective has a consideration in the same terms. The Expert Panel has said871 that ‘social inclusion’ may be understood as an outcome whereby all persons, regardless of their circumstances, have the opportunity and capacity to participate fully in society. The premise of these provisions is that participation in employment and other forms of work is a means by which ‘social inclusion’ may be achieved, by allowing individuals to obtain both the economic and social benefits of such participation. [976] The parties’ submissions tended to deal with workforce participation and the potential for disemployment effects and unemployment together. The two concepts of workforce participation and unemployment are distinct but related in the sense that discouragement consequent on unemployment may lead to people giving up on their job search and dropping out of the labour force altogether. Our observations above as to employment effects are therefore apt to be considered here, as well. 870 Fair Work Act ss 284(1)(b) and 134(1)(c). 871 Annual Wage Review 2025 Decision, [86]. [2026] FWCFB 75 255 [977] The Ai Group referred us to the report Employers’ experiences of young job applicants872 by Jobs and Skills Australia, an Australian government authority. This report is about jobseekers aged 15 to 24. The report also refers to a cohort of people referred to as NEETs – young people who are not in employment, education, or training. This cohort may include both young people who are unemployed, and young people who are outside the labour market altogether, not looking for work.873 Essentially this report went to what employers were looking for in hiring workers aged 15 to 24. It concluded:874 “Generally, employers are looking for someone with the whole package: education, relevant experience and employability skills (i.e. with the right attitude, good communication skills and relevant experience for the job). These findings align with evidence from the Australian Census Longitudinal Dataset which shows that completing Year 12 is essential as a first step while building their skills with the right qualifications is important to improve their job prospects.” [978] The Ai Group submitted:875 “Junior pay rates are designed to encourage employers to hire young people by offering a lower initial wage and thereby lower the barriers for young people to enter and remain in the labour market…” [979] We accept that work experience has value for both reducing unemployment and increasing workforce participation. Just as we consider sub-minimum rates for some classes of juniors have a role to play in addressing labour market disadvantage, we consider an effect of this is assisting young people to gain work experience, which assists in promoting workforce participation now and in the future. [980] We are satisfied that our decision will not affect workforce participation for minors, as we have decided not to alter their rates. For young adults, we have found, above, that it is likely there would be minimal or small disemployment effects. If there were to be any associated effects on workforce participation those would also be minimal or small. However, this has not been established, and becoming unemployed does not necessarily lead to an employee dropping out of the workforce altogether. [981] We have accepted above that the higher minimum wages could also attract greater labour supply.876 In our view this suggests a possible increase in workforce participation by this age cohort. Relative living standards and the needs of the low paid: ss 284(1)(c), 134(1)(a) [982] Sections 284(1)(c) and 134(1)(a) of the Fair Work Act require consideration of the ‘relative living standards and the needs of the low paid’. We accept the submission that workers 872 Jobs and Skills Australia, Employers’ experiences of young job applicants, March 2025. 873 Ibid, 1. 874 Ibid, 11. 875 Ai Group’s outline of submissions, [48]. 876 Exhibit 1, Borland principal report, [20]-[21]; Exhibit 84, Hyslop principal report, [33]. [2026] FWCFB 75 256 employed under the three awards and being paid junior rates are low paid. It was not in contest, and we accept, that junior employees paid according to the junior rates under consideration in these proceedings are low paid. The parties’ submissions went to the issues of relative living standards, and needs, having regard to junior employees’ households and living arrangements. [983] The applicant’s lay evidence showed the diversity of personal circumstances of junior employees. Some young adults were living in the family home and still being supported by their parents to a greater or lesser extent; some minors had moved out of home, or were living in the family home but making a significant contribution to household expenses. [984] The Ai Group referred877 to a 2021 AIHW report.878 It estimated that in 2017-18, 74% (or 1.1 million) of people aged 15–19 lived as a dependent student, and 19% (275,000) lived as a non-dependent child. The ARA and the MGA referred us to an AIFS report. That report recorded that the 2021 Census had shown that 72% of 19-year-olds were living with their parents.879 The same AIFS report found that the proportion of young people living at home with parents declined with age, with the drop accelerating from 18 years of age when many finish secondary education. It also found lower incomes were evident for those living with parents compared to those who were not: • At age 15–19 years, 80% of boys and men and 84% of girls and women living at home had personal income less than $16,000. • Young men aged 20–24 living with their parents were around twice as likely to have a personal income of under $16,000 per year compared to those not living with parents (28% vs 15%). [985] ACCI880 referred us to a Melbourne Institute report on the HILDA881 survey that found that 84.8% of men and 79.5% of women aged 18 to 21 live at home. [986] Ai Group submitted that dependent students did not rely on their income for essentials but rather for non-essentials. It submitted that although the employees are low paid, they live at home and do not rely on income for essentials. They have better relative living standards than others and largely have essential needs (shelter, food) provided by others.882 ACCI submitted883 junior employees up until the age of 21 generally experience higher living standards and are less burdened by the costs of daily living. This is due, in part, to many still living at home and not assuming the full cost of independent living. BNSW-ABI submitted that the Commission should be extremely cautious in correlating junior rates with lower relative living standards of those who earn them. [987] The ARA and Ai Group also submitted that government and other concessions and income support assisted people aged under 21 with their financial needs. ACCI also referred to 877 Ai Group’s outline of submissions, [37(c)]. 878 Australian Institute of Health and Welfare (2021) Australia’s youth. 879 Citing ‘Young people living with parents,’ Australian Institute of Family Studies, June 2023. 880 ACCI’s written submissions, [51]. 881 Melbourne Institute, The Household, Income and Labour Dynamics in Australia Survey: Selected Findings from Waves 1 to 21 (2023), page 21. 882 Ai Group’s outline of submissions, [61]. 883 ACCI’s written submissions, [34]. [2026] FWCFB 75 257 a broad range of social supports available to young people. The SDA submitted that taking into account Youth Allowance or other welfare payments subverted the ordinary approach taken by the Commission in the Annual Wage Review, on the basis that the starting point is a single adult household receiving no assistance from the welfare system,884 citing the 2018-2019 Annual Wage Review Decision. In that decision, the Expert Panel said that household type was the ‘starting point’ but also accepted they must take into account the needs of the low paid, without limitation. Accordingly, they also considered the needs of other types of families and explicitly took into account the tax-transfer system.885 The Commission has also taken the tax- transfer system into account in more recent Annual Wage Reviews. 886 We consider we can take the tax-transfer system into account in the context of exercising powers in relation to minimum wages. However, we accept the SDA’s submission that it would be unsafe to assume access to transfers such as youth allowance or other income support payments when setting rates for all junior employees, particularly in the absence of any expert evidence in that regard.887 [988] ACCI submitted that modern awards are not capable of addressing the nuances of the circumstances of each individual worker, and nor are they intended to.888 [989] The MGA submitted that a majority of junior employees do not have the same responsibilities as many adult employees. It gave the example of 19-year-olds living with their parents, which it said supported the argument that young adults likely had their parents’ support with rent/mortgage payments, food, utility bills, and other associated costs.889 [990] “The low paid” are not homogenous and nor are their needs. They also do not live in homogenous households. In the Annual Wage Review 2025 Decision, the Expert Panel said:890 “Analysing the needs of the low paid in the context of their household income presents a degree of difficulty because of the variety of household types potentially involved. To begin with, far from all low-paid employees live in low-income households. Only half of low-paid award-reliant employees are in the bottom quartile of the employee household income distribution, and 24 per cent are in the top two quartiles.”891 [991] After considering the data they went on to find that they were satisfied there was ‘some proportion’ of low-paid award-reliant employees who would struggle to meet the Minimum Income for Healthy Living (MIHL).892 884 SDA closing submissions, [273], citing Annual Wage Review 2018-19 [2019] FWCFB 3500, [343]. 885 Annual Wage Review 2018-19 [2019] FWCFB 3500, [54]; [326]-[331]. 886 See for example, Annual Wage Review 2021-22 [2022] FWCFB 3500, [147]-[157]; Annual Wage Review 2023-2024 [2024] FWCFB 3500, [48]-[50]. 887 SDA closing submissions, [273]. 888 ACCI’s written submissions, [35]. 889 At 102, relying on Australian Institute of Family Studies, ‘More young adults living with parents than ever before’ (June 2023): <https://aifs.gov.au/media/more-young-adults-living-parents>. 890 Annual Wage Review 2025 Decision, [111]. 891 Citing Jamie van Netten and Josh Lipp, Award-reliant employees in the household income distribution of employees: an update (Fair Work Commission Research Report No 2/2025, February 2025) (“van Netten and Lipp, 2025”), Chart 2. 892 Annual Wage Review 2025 Decision [115]. [2026] FWCFB 75 258 [992] Self-evidently the data to which the parties referred us does not relate specifically to the junior employees covered by the three awards, leaving us to draw inferences from the data that relates to young people generally. The data also do not tell us the household incomes of the family homes, for those young people living at home. The published FWC staff report cited in the Annual Wage Review 2025 Decision indicates that dependent students who accounted for close to one-quarter of award-reliant employees were relatively less concentrated in the lower household income deciles.893 We would not be surprised if it was harder for lower income households to afford to support dependent students. [993] In light of the foregoing, the conclusions we can draw from the data are tentative. We take from it, and the lay evidence as to actual employees’ living situations and financial responsibilities, that there is some proportion of employees paid junior rates who would have low relative living standards, and/or some difficulty having their needs met, and many who would not. The younger the employee, the more likely they are to be living at home, so, generally, we would expect need and living standards issues to become more acute as the junior employees get older. This consideration tends to align with our consideration of fair minimum wages for junior employees. Gender equality: ss 284(1)(aa), 134(1)(ab) [994] We have taken into account the need to achieve gender equality, including by ensuring equal remuneration for work of equal or comparable value, eliminating gender-based undervaluation of work and addressing gender pay gaps. [995] There is very little direct evidence before us regarding the gender distribution of junior employees under these three awards. Ms Bridges’ statement shows there were more male than female junior employees at Coles in June 2025.894 In addition, some of the research sources referred to gender. The Ai Group referred us to a 2011 NCVER research paper895 about combining school and work, which included data as to gender. The 2023 FWC staff report896 to which Dr Hyslop had referred provided some data in relation to the gender distribution of the three awards. That report indicated that around two in three employees reliant on the General Retail Industry Award were female.897 It indicated that the share of the (total) employees who were reliant on that award and were on junior rates was 17.8%. Around 60% of employees reliant on the Fast Food Industry Award were female.898 The share of the employees on junior rates was 61.8%. Around 90% of employees reliant on the Pharmacy Industry Award were female.899 893 van Netten and Lipp, 2025, 51. 894 Exhibit 109, Witness Statement of Emma Bridges, [21]. 895 Anlezark, A., & Lim, P. (2011) Does Combining School and Work Affect School and Post-School Outcomes? Longitudinal Surveys of Australian Youth. National Centre for Vocational Education Research. 896 Yuen & Tomlinson (2023). 897 Ibid, 28. 898 Yuen & Tomlinson (2023)., p 35. 899 Yuen & Tomlinson (2023), 10 (n 6), 52. [2026] FWCFB 75 259 [996] The SDA submitted that gender equality is a neutral consideration900 as did BNSW- ABI.901 In contrast, the Ai Group submitted that the evidence indicated that “females participate in work as junior employees at higher rates than males.”902 It submitted that “placing barriers to employment for junior employees, in the form of reducing the discount on their rates of pay,” would “therefore disproportionately affect females and therefore not facilitate full economic participation.”903 Here, they are implicitly arguing that fixing lower minimum wages for a cohort of employees in which girls and women are overrepresented would better promote gender equality. This is unorthodox. [997] In any event, in the Annual Wage Review 2025 Decision, the Expert Panel said the main contribution to the achievement of gender equality consistent with ss 284(1)(aa) and 134(1)(ab) of the Fair Work Act would continue to be the review of identified priority awards in order to eliminate gender-based undervaluation and ensure equal remuneration for work of equal or comparable value.904 With respect, we agree. Also, as the junior rates under consideration in these current proceedings operate as proportions of the rates generally payable for each classification, we consider matters of gender equality are more salient to consideration of those general rates, and the classification structure. The need to improve access to secure work across the economy (s 134(1)(aa)) [998] This limb of section 134(1) was added to the modern awards objective by the Secure Jobs, Better Pay Act, which also amended s 3 to include promoting job security. RAFFWU submitted:905 “We note the Modern Award Objectives have changed since any deep analysis of junior rates. They now place secure work front and centre in the deliberations of the Fair Work Commission.” [999] The ARA referred us906 to the Revised Explanatory Memorandum to the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Bill 2022, which had stated that including job security and gender equality in section 3 would “place these considerations at the heart of the FWC’s decision-making, and support the Government’s priorities of delivering secure, well-paid jobs and ensuring women have equal opportunities and equal pay.”907 We note that in respect of the inclusion in s 3, the Revised Explanatory Memorandum stated:908 900 SDA’s outline of submissions, [120]. 901 BNSW-ABI’s submission, [144]. 902 Ai Group’s outline of submissions, [45], referring to Anlezark, A., & Lim, P. (2011) Does Combining School and Work Affect School and Post-School Outcomes? Longitudinal Surveys of Australian Youth. National Centre for Vocational Education Research. 903 Ai Group’s outline of submissions, [45]. 904 Annual Wage Review 2025 Decision, [150]. 905 RAFFWU’s outline of submissions, [28]. 906 ARA’s closing submissions, [76]. 907 Revised Explanatory Memorandum to the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Bill 2022, [330]. 908 Revised Explanatory Memorandum to the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Bill 2022, [334]. [2026] FWCFB 75 260 “The reference to promoting job security recognises the importance of employees and job seekers having the choice to be able to enjoy, to the fullest extent possible, ongoing, stable and secure employment that provides regular and predictable access to beneficial wages and conditions of employment.” [1000] The Expert Panel considered s 134(1)(aa) as it applied in the context of the annual wage reviews system in the 2023 Annual Wage Review Decision:909 “ … In the award context, job security is a concept which is usually regarded as relevant to award terms which promote regularity and predictability in hours of work and income and restrict the capacity of employers to terminate employment at will. The award provisions which are likely to be most pertinent in this respect are those which concern the type of employment (full-time, part-time, casual or other), rostering arrangements, minimum hours of work per day and per week, the payment of weekly or monthly rather than hourly wages, notice of termination of employment and redundancy pay (noting that a number of these matters are dealt with in the NES). Beyond the immediate award context, job security has a broader dimension and may be understood as referable to the effect of general economic circumstances upon the capacity of employers to employ, or continue to employ, workers, especially on a permanent rather than casual basis. In exercising the Commission’s modern award powers, consequential effects of this nature arise for consideration under ss 134(1)(f) and 284(1)(a), and have always been taken into account on this basis in past Review decisions. As set out above, paragraph 334 of the REM explains that the reference to promoting job security in s 3(a) recognises the importance of employees and job seekers ‘having the choice’ to be able to enjoy as much as possible ‘ongoing, stable and secure employment that provides regular and predictable access to beneficial wages and conditions of employment’. We see no reason to consider that the expression ‘secure work’ in s 134(1)(aa) bears any substantially different connotation to ‘job security’ in s 3(a). However, we consider that it is significant that s 134(1)(aa) refers to ‘the need to improve access’ to secure work rather than the general promotion of job security. The language of s 134(1)(aa) suggests that it is more tightly focused on the capacity of employees to enter into work which may be characterised as secure. This appears to reflect the REM’s reference to the importance of employees being able to have a ‘choice’ to enter into secure employment. As such, the consideration in s 134(1)(aa) would appear to direct attention primarily to those award terms which affect the capacity of employees to make that choice. This is not a matter likely to be of substantial relevance to the consideration of minimum award wages in the conduct of the Review except perhaps in respect of the casual loading. The fact that s 134(1)(aa) finds no equivalent in s 284(1), such that the secure work consideration has no application to the NMW, supports our conclusion in this respect. However, the broader dimension of job security to which we have referred will, of course, continue to be highly relevant in our consideration under ss 134(1)(f) and 284(1)(a).” 909 Annual Wage Review 2023 [2023] FWCFB 3500, [28]-[30]. [2026] FWCFB 75 261 [1001] As can be appreciated, the Expert Panel considered s 134(1)(aa) to be more relevant to conditions than wages, save in respect of casual loadings. Subsequent Annual Wage Review decisions took the same approach. Although it was common ground that these proceedings relate to minimum wages, a number of parties made submissions as to the effect of the proposed variations on access to secure work. We consider that to the extent those submissions simply conflated employment and job security issues, it is not necessary to deal with them. However, some of the submissions dealt with whether and if so how the changes in relative minimum wages between classes of employees would affect the prevalence of casual compared with part- time employment. [1002] Casual loadings change the relative costs of employing casuals and permanent employees. Changes to junior rates change the relative costs of employing juniors and non- junior employees. The fast food and general retail industries are highly casualised.910 This was not in contest. Also, though there are careers in fast food, it is more common for people to work in the industry for a short period.911 On the other hand, the community pharmacy industry appears to have a low degree of casualisation.912 [1003] The SDA913 and RAFFWU914 also submitted that increasing minimum wages for junior employees, by requiring that they be paid the adult rates, would promote job security by incentivising employers to offer permanent part-time rather than casual employment. Prof Lewis’s evidence, under cross-examination, was that this was one way that employers could reduce costs.915 [1004] Ai Group submitted that substitution effects discussed above would reduce security for junior employees, as they would be replaced by older workers. RAFFWU made a corresponding submission, in the opposite direction: it submitted that junior rates cause insecure work for other employees, because the employer is driven to replace their labour with cheaper (junior) labour. As can be gleaned from the history set out above, this issue has long been raised in relation to junior rates, including in the Mark Foy case. In early decades of arbitration, junior rates provisions were accompanied by proportion provisions, dealing with the ratios of adults to juniors. [1005] Accepting that raising the pay rates for young adults would give rise to substitution towards employees aged 21 and over, this does not necessitate the conclusion that the propensity of employers to offer permanent rather than casual work would increase. Similarly, if there was no substitution, and the age mix of the workforce stayed the same notwithstanding the change in minimum wages, this does not mean that changing the mix of bases of engagement would be among the means by which employers managed costs. 910 Yuen & Tomlinson (2023), 58. 911 See Exhibit 92, Witness Statement of Jennifer De Witte, [14], where the average tenure of employees aged 21 or over is approximately 2 years 10 months (Craveable); Exhibit 104, Witness Statement of Christopher Turner, [7], Crew Members have an average age of 18 and an average tenure of 1 year, 6 months (McDonalds); cf Exhibit 95, Witness Statement of Christine Bletsas (Hungry Jacks), [33]. 912 Yuen & Tomlinson (2023), 58. 913 SDA’s closing submissions, [200]. 914 RAFFWU’s outline of submissions, [33]. 915 PN1684. [2026] FWCFB 75 262 [1006] On the one hand, part-time employees might be considered cheaper; alternatively, employers may not want higher leave liabilities on their balance sheets. Also, as discussed above, shifting employees from casual to permanent is not the only means at employers’ disposal to manage impacts on profits. Other options include pass-through and absorbing the costs, and those options are in turn contingent on issues such as the impacts of price increases on demand and on the profitability of the business (or the relevant part of it). We expect employers will act rationally and in a manner that maximises their profits. The issue of whether they prefer part-time to casual engagement will likely depend on a range of factors but if they do make costs savings through this mechanism then that would affect the magnitude of any employment effects of the variations, noting the expert evidence that employment effects will turn on costs. To summarise, there would be commercial considerations to be weighed. On the state of the evidence before us we do not make any findings as to the likely consequence, for employees’ choice of permanent or casual engagement, if young adults are required to be paid the adult minimum wages. 134(1)(g) the need to ensure a simple, easy to understand, stable and sustainable modern award system for Australia that avoids unnecessary overlap of modern awards; and [1007] There is no change to award coverage contemplated by this application and so this limb is largely neutral. [1008] The parties were in contest as to whether the variations would simplify the structures by having fewer age-based changes. Ai Group submitted that if the variations sought by the SDA were made, they would remain age-based, and there was no material effect on simplicity or ease of understanding.916 We agree that there would be little difference in administrative ease after variation if the rates continued to be age-based, and calculated by reference to percentages. [1009] As to simplicity and ease of understanding, we are alive to the administrative and substantive difficulties for employers and employees, of calculating experience by reference to industry or occupation. We consider the practical approach to be consistent with the existing approach under the general retail award, i.e. to take into account only experience with the same employer. We consider it consistent with the General Retail 20-year-old Junior Rates Decision (2014) that the appropriate amount of experience to accrue before being exempted from the relevant junior rate is six months. We would apply the same experience exclusion for junior rates available in relation to the employment of 18- and 19-year-olds. Other considerations [1010] We have taken into account the following other matters, as required: • the encouragement of collective bargaining (s 134(1)(b)); • the need to promote flexible modern work practices and the efficient and productive performance of work (s 134(1)(d)); and • the need to provide additional remuneration for (i) employees working overtime; or (ii) employees working unsocial, irregular, or unpredictable hours; or (iii) employees 916 Ai Group’s outline of submissions, [37(f)]. [2026] FWCFB 75 263 working on weekends or public holidays; or (iv) employees working shifts (134(1) (da)). [1011] We find these other matters to be neutral considerations in these proceedings. We have taken the national minimum wage order into account [1012] As stated above, in exercising its powers under Part 2-3 to set, vary or revoke modern award minimum wages, the Commission must take into account the rate of the national minimum wage as currently set in a national minimum wage order: s 135(2). [1013] We have referred, above, to the Ai Group’s submissions as to the National Minimum Wage Order. We provide the following additional consideration. [1014] The National Minimum Wage Order 2025917 came into operation on 1 July 2025 and remains in operation. Under the NMWO 2025, “junior employee” has the same meaning as under the Fair Work Act (cl 3.1). Under it, the national minimum wage is $948.00 per week, calculated on the basis of a week of 38 ordinary hours, or $24.95 per hour. However, the national minimum wage applies to an award/agreement-free employee other than, relevantly, junior employees (cl 4). Special national minimum wage 3 (“Special NMW 3”) applies to an award/agreement-free junior employee (cl 8). Under Special NMW 3, the employer must pay junior employees a base rate of pay that at least equals the following percentage of the national minimum wage: Age %age Under 16 years of age 36.8 At 16 years of age 47.3 At 17 years of age 57.8 At 18 years of age 68.3 At 19 years of age 82.5 At 20 years of age 97.7 [1015] As can be appreciated the proportions between the junior and adult minima under Special NMW 3 differ from the proportions in the three awards under consideration in this case. The rates are closest together at age 18, but widen progressively in each direction. So, Special NMW 3 junior rates for workers under 16 are 36.8%. There is a larger gap between 36.8% and 40% or 45% on the one hand, than between 68.3% and 70% on the other. Similarly, there is a larger gap between 97.7% and 90% (albeit this rate is not applicable to all 20-year-olds under the General Retail Industry Award), than there is between 68.3% and 70%. The proportions between the junior and adult rates in the NMWO 2025 start from a lower base, and have a steeper trajectory, than the proportions between junior and adult rates in the three awards the subject of these proceedings. [1016] Taking into account the NMWO 2025, we consider there is no requirement of uniformity between that instrument and junior rates in awards. Taking into account that the nature of the NMWO 2025 is that it sets minima, we would not be inclined to vary any rates so 917 Appendix A to PR786529. [2026] FWCFB 75 264 that they provided for proportions lower than those provided for in Special NMW 3, but in any event no-one has advanced any such proposition to us. We have taken into account the Fair Work Act’s objects [1017] As indicated above we must take the Fair Work Act’s objects into account. The parties made submissions as to section 3 and various paragraphs of it. We have taken the whole of section 3 of the Fair Work Act, and the matters referred to in it, into account. We will now provide some detailed consideration in relation to the object provision insofar as it relates to international labour obligations. International labour obligations [1018] Section 3 of the Fair Work Act provides that one of the means by which the principal object is given effect is by “providing workplace relations laws that are fair to working Australians, promote job security and gender equality, are flexible for businesses, promote productivity and economic growth for Australia’s future economic prosperity and take into account Australia’s international labour obligations.” The Fair Work Act is thus intended to provide for laws that take Australia’s international labour obligations into account. In turn, the Commission has to take the Fair Work Act’s objects into account918. Some of the parties made submissions to us as to whether junior rates are consistent with Australia’s international obligations. [1019] We derived significant assistance from Youth Law Australia’s submissions in that regard, including as to which international instruments are relevant. They referred us to the International Covenant on Economic, Social and Cultural Rights,919 the Employment Discrimination Convention, the International Labour Organisation Convention (No. 131) concerning Minimum Wage Fixing, with Special Reference to Developing Countries920 (“the Minimum Wage Fixing Convention”), the International Labour Organisation Convention No. 138: Convention concerning Minimum Age for Admission to Employment,921 the UDHR, and the Sustainable Development Goals. In essence, Youth Law Australia submitted that, with respect to employment, Australia has obligations to: • Take steps to eliminate discrimination in the workplace; and • Give effect to the rights of all workers to receive equal pay for equal work. [1020] Youth Law Australia submitted that laws allowing lower pay for equal work, merely on the basis of age, are not consistent with Australia’s international labour obligations and are not justified by any exceptions to them. [1021] RAFFWU asked us to have regard to Article 23 of the Universal Declaration of Human Rights, as well as the Employment Discrimination Convention, the ambit of which, it says, was expanded domestically to include age. It contended for two different bases for us to take into account international obligations: section 15AB of the Acts Interpretation Act, and the reference in section 3 of the Fair Work Act to Australia’s international labour obligations. 918 Fair Work Act s 578. 919 (New York, 16 December 1966) [1976] ATS 5. 920 (Geneva, 22 June 1970) [1974] ATS 13. 921 (Geneva, 26 June 1973) [2022] ATNIF 10, which Australia ratified in 2023. [2026] FWCFB 75 265 [1022] ACCI submitted that junior rates were consistent with the Employment Discrimination Convention. [1023] It is necessary to have regard to international labour obligations to construe s 3 of the Fair Work Act. In addition, section 15AB of the Acts Interpretation Act allows us to take into account extrinsic material in construing a provision, to confirm that its meaning is the ordinary meaning (taking into account its context in the Act and the purpose or object underlying the Act); or to determine the meaning of the provision if its meaning is ambiguous or obscure, or manifestly absurd or unreasonable. Subsection 15AB(2) includes, at paragraph (d), “any treaty or other international agreement that is referred to in the Act.” The UDHR is not a treaty or convention and is not referred to in the Fair Work Act. The Employment Discrimination Convention is referred to in the Fair Work Act, but not in relation to Part 2-3 or Part 2-6. As stated above, though, we are required to take the Fair Work Act’s objects into account. What then is meant by “Australia’s international labour obligations,” in section 3 of the Fair Work Act? The Explanatory Memorandum for the Fair Work Bill 2008 says: 2251. The objects of the Bill require FWA to take into account Australia‘s international labour obligations – see paragraph 3(a). Australia has international labour obligations under instruments including: ILO Convention (No. 100) concerning Equal Remuneration for Men and Women Workers for Work of Equal Value (Geneva, 29 June 1951) [1975] ATS 45; ILO Convention (No. 111) concerning Discrimination in respect of Employment and Occupation (Geneva, 25 June 1958) [1974] ATS 12; the International Covenant on Economic, Social and Cultural Rights (New York, 16 December 1966) [1976] ATS 5; the Convention on the Elimination of All Forms of Discrimination against Women (New York, 18 December 1979) [1983] ATS 9; ILO Convention (No. 156) concerning Equal Opportunities and Equal Treatment for Men and Women Workers: Workers with Family Responsibilities (Geneva, 23 June 1981) [1991] ATS 7; ILO Convention (No. 158) concerning Termination of Employment at the Initiative of the Employer (Geneva, 22 June 1982) [1994] ATS 4; and ILO Recommendation (No. 166) concerning Termination of Employment at the Initiative of the Employer (Geneva, 22 June 1982). [1024] This list in the Fair Work Bill Explanatory Memorandum is not, on its face, exhaustive. We do not consider it requires consideration of the UDHR which, not being a treaty or convention, does not create obligations but is rather a highly influential statement on the [2026] FWCFB 75 266 understanding of universal and fundamental human rights.922 However, the UDHR is no doubt useful in understanding the foundation of the various rights, though having regard to the UDHR does not necessarily take the matter further than would be the case if only treaties and conventions were to be considered: it is clear enough that article 23 of the UDHR provides for non-discrimination at work, and must be read together with the remainder of the instrument including article 25 which allows for special care and assistance in childhood. [1025] International human rights are given effect through, inter alia, the International Covenant on Civil and Political Rights and the International Covenant on Economic, Social and Cultural Rights.923 The latter includes the right to work and the opportunity to earn a living,924 and the right to fair wages and equal remuneration for work of equal value,925 among other rights. Youth Law Australia submitted that in 1945 the International Labour Conference had resolved that:926 “Provisions with reference to wages paid to young workers should have the objective of assuring that they are paid wages commensurate with the work performed, observing wherever possible the principle of equal pay for comparable jobs. Provision should be made for inexperienced young workers through learners’ rates when substantial periods of learning are required and through apprenticeship programs…” [1026] We note that resolution contemplated rates for unapprenticed young workers that took into account the average time needed to gain proficiency without prejudicing the principle of equal pay for equal work.927 [1027] Turning to ILO Convention (No. 111) concerning Discrimination in respect of Employment and Occupation, Article 2 provides that each member state “undertakes to declare and pursue a national policy designed to promote, by methods appropriate to national conditions and practice, equality of opportunity and treatment in respect of employment and occupation, with a view to eliminating any discrimination in respect thereof.” “Discrimination” is defined in Article 1.1(a), which does not include age. However, Article 1.1(b) allows state parties to add grounds unilaterally for their own purposes. Australia added age as a ground with effect from 1990.928 At Article 5, C111 allows for, relevantly, ‘special measures’ which can be introduced after consultation with representative employers’ and workers’ organisations, and must be designed to meet the particular requirements of people who, because of the particular ground (in this case, age) are generally recognised to require special protection or assistance. C111 was important as part of the constitutional underpinning of the anti-discrimination reforms in the Industrial Relations Reform Act 1993.929 922 Newcrest Mining (WA) Ltd v the Commonwealth [1997] HCA 38; 190 CLR 513 (Kirby J). 923 The International Covenant on Economic, Social and Cultural Rights (New York, 16 December 1966) [1976] ATS 5 (“ICESCR”). 924 Ibid, Article 6. 925 Ibid, Article 7. 926 International Labour Conference (27th, 1945: Paris, France), ‘Resolutions concerning the protection of children and young workers, submitted by the Committee on the protection of children and young workers’, [30]. 927 Ibid, [30(a)(ii)]. 928 Human Rights and Equal Opportunity Commission Regulations 1989 (Cth). 929 See the discussion at 1999 AIRC Junior Rates Inquiry report, Appendix C, [8]. [2026] FWCFB 75 267 [1028] Australia has also ratified the ILO Minimum Wage-Fixing Convention (1970). That convention neither explicitly provides for nor prohibits setting different minimum wages on the basis of age. It does, however, provide for each member state to establish a system of minimum wages which covers all groups of wage earners whose terms of employment are such that coverage would be appropriate. It provides for the competent authority in each country to, in agreement or after full consultation with the representative organisations of employers and workers concerned, where such exist, determine the groups of wage earners to be covered. At Article 3 it provides that: “The elements to be taken into consideration in determining the level of minimum wages shall, so far as possible and appropriate in relation to national practice and conditions, include - (a) the needs of workers and their families, taking into account the general level of wages in the country, the cost of living, social security benefits, and the relative living standards of other social groups; (b) economic factors, including the requirements of economic development, levels of productivity and the desirability of attaining and maintaining a high level of employment.” [1029] These provisions were also referred to in the Explanatory Memorandum to the Industrial Relations Reform Bill 1993. The bill provided for minimum wages orders to supplement minimum wages provided for by awards and agreements, with the relevant division containing an object of giving effect to the Minimum Wage Fixing Convention. The Explanatory Memorandum explained that the Commission would have the power to make minimum wages orders for groups of employees, but that many employees, including within those groups, would be ineligible (for example because they had the benefit of arbitrated minima, including by State industrial tribunals). The Explanatory Memorandum stated that during the negotiation of the Convention, the ILO had accepted that the requirements of ‘full consultation’ under the Convention would be met by a system where employers’ and workers’ representatives were given an opportunity to give evidence before a wage-fixing tribunal, as the bill provided. In our view, this Convention contemplates different minima for different groups, and allows for the competent authority to take into account competing considerations. They should be read with the provisions of the UDHR and the ICESCR regarding freedom from discrimination and equal pay for work of equal value. The Minimum Age Convention (C138) also neither prohibits not explicitly provides for differential minimum wages on the basis of age. [1030] We also observe that the United Nations Convention on the Rights of the Child (“UNCRC”) applies to people under eighteen. We were not referred to this instrument. It requires that in all actions concerning children, the best interests of the child is to be a primary consideration. The UNCRC also prohibits economic exploitation and sets out a right to “a standard of living adequate for the child's physical, mental, spiritual, moral and social development” while reserving primary responsibility for their parents to secure, within the parents’ abilities and financial capacities, the conditions of living necessary for the child's development. The protection against economic exploitation, read in the context of the primacy of the best interests of the child and the responsibility of parents, might also be considered an international labour obligation for the purposes of section 3 of the Fair Work Act, noting from the excerpt from the Explanatory Memorandum above that the phrase is not confined to [2026] FWCFB 75 268 referring only to International Labour Organisation instruments. In the absence of argument before us we will not consider this convention save to say that we doubt that the current junior rates for children in the three awards under consideration in this case could be said, categorically, to be inconsistent with it. [1031] We do not consider that the phrase “international labour obligations” extends to the Sustainable Development Goals under the 2030 Agenda for Sustainable Development, a set of international aspirations. [1032] Youth Law Australia argues that junior rates cannot be seen as a special measure of that type. They submitted930 that commentary of the ILO Committee of Experts and the International Labour Office on the relevant provision, Article 5(2) of C111, establishes that to be permitted as a special measure of protection or assistance, a policy must: (a) in fact pursue the objective of offering protection or assistance, and ensure equality of opportunity and treatment in practice, taking into account the diversity of situations of certain persons;931 (b) be proportional to the nature and scope of the protection needed or of the existing discrimination;932 (c) once adopted, be re-examined periodically, in order to ascertain whether it is still needed and remains effective, bearing in mind that such measures are clearly of a temporary nature.933 [1033] The parties also referred to special measures under the ICESCR as having similar requirements. They submit these requirements are not met. We are not persuaded of this. Junior rates have the potential to be net benefits or detriments to individuals depending on whether any assistance they provide with getting into the labour market and increasing future earnings is sufficient to compensate for the lower present income. Generally, though, the identifiable protection or assistance is providing a competitive advantage in the labour market. Junior rates allow younger workers to lawfully accept lower rates of pay compared with other workers. This is an option that most workers do not have: a 45-year-old worker cannot underbid another worker, below the award rate for a particular classification, in order to get a job ahead of that other worker. [1034] In the 1999 AIRC Junior Rates Inquiry report, the Full Bench took the view that junior rates were discriminatory. They discarded the suggestion that junior rates could be considered non-discriminatory as special measures because they were not sufficiently related to the 930 Youth Law Australia’s closing submissions, [39]. 931 Citing International Labour Office, ‘Fundamental Rights at Work and International Labour Standards’ (Geneva, 2003), p77; General Survey by the Committee of Experts on the Application of Conventions and Recommendations, ‘Equality in Employment and Occupation’, International Labour Conference 75th Session 1988, [147]. 932 Ibid. 933 Ibid. [2026] FWCFB 75 269 inherent requirements of the employment.934 Their task was to consider non-discriminatory alternatives. The desirability of replacing junior rates with non-discriminatory alternatives was implicit in the legislation at the time.935 That is not the case today, where junior rates are expressly excluded from being considered discriminatory for the purposes of the Fair Work Act.936 The Full Bench did not consider the existing junior rates at the time to be special measures for the purposes of ILO Convention 111,937 though considered it was not a matter for the Commission to determine this conclusively.938 They also saw no reason why a special measure of that kind might not be designed to allow young people with a relative lack of opportunity to be competitive in some sectors of the employment market.939 [1035] For our part, we consider junior rates that increase in proportion by reference to age and that have an ‘exit age’ to be capable of being considered proportional to the nature and scope of the protection needed for young people entering the labour market, and to be subject to periodic re-examination which can be done at the Commission’s own motion or by application, as is the case in these proceedings. In those circumstances we consider it arguable that junior rates in force via modern awards are able to be considered special measures. [1036] We would observe that there are competing, legitimate aspirations to be considered, in taking into account Australia’s international labour obligations. For example, a right to work is of less utility without measures to give effect to it, for persons who lack power in the labour market. One of the primary arguments for junior rates is that they benefit young people by providing them with a competitive advantage against older workers in the labour market940 – a lower wage price, to balance against older workers’ own competitive advantages – such as maturity and experience. The 1999 AIRC Junior Rates Inquiry report stated that the Full Bench had reached the “pragmatic conclusion” that “if young people are to secure entry level employment and progress to economic self-sufficiency through paid employment, they more than ever needed to be competitive in the labour market.”941 So, the benefit is not just the present benefit of being able to get a job, but also the future benefits contingent on or affected by entry into the labour market. [1037] As can be appreciated from the foregoing there are a range of international obligations to take into account, promoting rights in relation to equal pay for equal work, non- discrimination, economic participation, the protection of children from exploitation, and the right to work, among the others we have discussed. We have taken those international obligations into account in making our decision. However, taking into account Australia’s international labour obligations does not mean that we should construe them as prevailing over the express words of the legislation. The Fair Work Act excludes minimum wages for junior employees from being discriminatory for the purposes of that Act. 934 1999 AIRC Junior Rates Inquiry report, [3.2.9]. 935 1999 AIRC Junior Rates Inquiry report, [4.1.3]. 936 Fair Work Act 2009 (Cth), s 153(3)(a). 937 1999 AIRC Junior Rates Inquiry report, [3.2.9]. 938 1999 AIRC Junior Rates Inquiry report, [3.2.10]. 939 1999 AIRC Junior Rates Inquiry report, [1.5.14]. 940 This was the explicit basis posed for the youth wages exemption in the Age Discrimination Bill 2003 (Cth), in its Explanatory Memorandum at p 12. 941 1999 AIRC Junior Rates Inquiry report, Summary, [4]. [2026] FWCFB 75 270 How we weighed the mandatory considerations, and other relevant matters [1038] We will now set out how we weighed the mandatory considerations, taking each of the three awards in turn. The General Retail Industry Award [1039] We will first set out how we weighed the considerations in relation to minors. We will then deal with adult junior employees. Minors [1040] We have weighed section 284(1)(e) most heavily in our consideration in relation to junior employees who are minor. That limb requires us to take into account providing a comprehensive range of fair minimum wages to, inter alia, junior employees, in establishing and maintaining a safety net of fair minimum wages. The matters we have referred to above, including, inter alia, the greater labour market disadvantage of minors, the different constraints on them, and the benefits associated with being able to get a foot in the door of the labour market, in our view mean that they should have the benefit of being able to accept special, discount rates. In our view the junior rates provisions benefit minors. That benefit should be continued. We have taken into account all of the other mandatory considerations under ss 134 and 284, as well as the Act’s objects and the NMWO. In our view the preponderance of these considerations, and the overarching consideration of fairness, weigh strongly in favour of this award providing for discount rates for junior employees who are minors. [1041] In light of the foregoing, and having undertaken a broad, evaluative process, weighing the mandatory considerations and taking into account, inter alia, the objects of the Fair Work Act, we are not satisfied that varying the rates paid to junior employees who are minors under the General Retail Industry Award is necessary to achieve the modern awards objective, or to achieve the minimum wages objective. Given this finding, as stated above, it has not been necessary for us to decide whether we are satisfied that variation is justified for work value reasons. [1042] In light of our finding we have decided not to make a determination varying the rates payable to junior employees who are minors. Young adults [1043] For the reasons set out above we are satisfied that varying the modern award minimum wages for junior employees, insofar as they apply to young adults, under the General Retail Industry Award is justified by work value reasons. [1044] We are satisfied that it is necessary to make a determination varying those modern award minimum outside the system of annual wage reviews, for the reasons set out above. [1045] We are satisfied that varying the modern award minimum wages, in the General Retail Industry Award, for junior employees, insofar as they apply to young adults, is necessary to [2026] FWCFB 75 271 achieve the modern awards objective and the minimum wages objective, weighing the mandatory considerations of each, as follows. [1046] We have taken into account the fairness of the safety net, including but not limited to whether the minimum wages reflect the value of the work, and whether it would be fair to allow young adults to accept lower wages to assist them in overcoming labour market disadvantage. We have taken into account that inexperienced young adults are likely to be disadvantaged to a greater extent than those who have experience. We have taken into account the potential employment effects of increasing rates payable to young adults relative to both minors and other adults. We have taken into account the likely impacts on business, particularly in relation to likely impacts on costs. In doing so we have had regard to the varying sizes and geographic locations of businesses, and we have taken into account impacts on small and medium businesses. We have also taken into account fairness to employers, noting that employers in the industry vary in size and circumstances. To mitigate the impacts on both junior employees and business we intend to implement variations to the rates for young adults over time, by including transitional arrangements in our determination when made. Given the expert evidence we consider the variations sought by the SDA would likely have limited impact on the national economy. In any event, any impacts on the national economy will also be mitigated by including transitional arrangements in the determinations when made. [1047] The considerations as to fairness and likely impacts on business have been weighed most heavily. We have also taken into account all of the mandatory matters in each of the modern awards and minimum wages objectives, as set out above. However, having regard to our consideration, above, these remaining matters are of less relevance and have weighed less heavily in our decision. [1048] Having weighed the mandatory considerations, we do not consider that junior rates should apply to adult workers, which is to say, workers aged 18 or over, purely by reference to age. There should be a limited window for the use of junior rates for young adults, of six months, while the young adult gains experience at the entry level, to assist in addressing labour market disadvantage. This is already the case for 20-year-olds under this award. Otherwise, adult workers should be paid the adult rates. [1049] We have also taken into account the Fair Work Act’s objects, and the National Minimum Wage Order. [1050] Having made the above findings we have decided to make a determination to vary the modern award minimum wages for junior employees, insofar as they apply to young adults, under Levels 1 to 3 the General Retail Industry Award, as follows: Age and experience % of minimum rate 18 years of age and employed by the employer for 6 months or less 70% 19 years of age and employed by the employer for 6 months or less 80% 20 years of age and employed by the employer for 6 months or less 90% (no change) [2026] FWCFB 75 272 Age and experience % of minimum rate All other junior employees aged 18 years of age or older (i.e. those employed by the employer for more than 6 months) 100% The Fast Food Industry Award [1051] As was the case for the previous award, we will first set out how we weighed the considerations in relation to minors. We will then deal with adult junior employees. Minors [1052] We have again weighed section 284(1)(e) most heavily in our consideration in relation to junior employees who are minor. That limb requires us to take into account providing a comprehensive range of fair minimum wages to, inter alia, junior employees, in establishing and maintaining a safety net of fair minimum wages. The matters we have referred to above, including, inter alia, the greater labour market disadvantage of minors, the different constraints on them, and the benefits associated with being able to get a foot in the door of the labour market, in our view mean that they should have the benefit of being able to accept special, discount rates. In our view the junior rates provisions benefit minors. That benefit should be continued. We have taken into account all of the other mandatory considerations under ss 134 and 284, as well as the Act’s objects and the NMWO. In our view, again, the preponderance of these considerations, and the overarching consideration of fairness, weigh strongly in favour of this award providing for discount rates for junior employees who are minors. [1053] Our view, above, is consistent across the three awards but is of particular significance in relation to the Fast Food Industry Award, given the relative importance of the industry in providing opportunities for younger teenagers getting their first start in the world of paid work. [1054] In light of the foregoing, and having undertaken a broad, evaluative process, weighing the mandatory considerations and taking into account, inter alia, the objects of the Fair Work Act, we are not satisfied that varying the rates paid to junior employees who are minors under the Fast Food Industry Award is necessary to achieve the modern awards objective, or to achieve the minimum wages objective. Given this finding, as stated above, it has not been necessary for us to decide whether we are satisfied that variation is justified for work value reasons. [1055] In light of our finding we have decided not to make a determination varying the rates payable to junior employees who are minors. [1056] The percentages for workers aged under 16 are different in the Fast Food Industry Award compared with the General Retail Industry Award and the Pharmacy Industry Award. For the reasons set out above we do not propose to alter those percentages. Young adults [1057] Again, we have taken into account the fairness of the safety net, including but not limited to whether the minimum wages reflect the value of the work, and whether it would be fair to [2026] FWCFB 75 273 allow young adults to accept lower wages to assist them in overcoming labour market disadvantage. We have taken into account that inexperienced young adults are likely to have greater disadvantages than those who have experience. We have taken into account the potential employment effects of increasing rates payable to young adults relative to both minors and other adults. We have taken into account the likely impacts on business, particularly in relation to likely impacts on costs. In doing so we have had regard to the varying sizes and geographic locations of businesses, and we have taken into account impacts on small and medium businesses. We have also taken into account fairness to employers, noting that employers in the industry vary in size and circumstances. To mitigate the impacts on both junior employees and business we intend to implement variations to the rates for young adults over time, by including transitional arrangements in our determination when made. Given the expert evidence, we consider the variations sought by the SDA would likely have limited impact on the national economy. In any event, any impacts on the national economy will also be mitigated by including transitional arrangements in the determinations when made. [1058] The considerations as to fairness and likely impacts on business have been weighed most heavily. We have also taken into account all of the mandatory matters in each of the modern awards and minimum wages objectives, as set out above. However, having regard to our consideration, above, these remaining matters are of less relevance and have weighed less heavily in our decision. [1059] For the reasons above, and having weighed the mandatory considerations, we again do not consider that junior rates should apply to adult workers, which is to say, workers aged 18 or over, purely by reference to age. There should be a limited window for the use of junior rates for young adults, of six months, while the young adult gains experience at the entry level, to address labour market disadvantage. Otherwise, adult workers should be paid the adult rates. [1060] We are satisfied that varying the rates payable to junior employees aged 18, 19 and 20 is necessary to meet the modern awards objective and the minimum wages objective. [1061] We have also taken into account the Fair Work Act’s objects, and the National Minimum Wage Order. [1062] Having made the above findings we have decided to make a determination to vary the modern award minimum wages for junior employees, insofar as they apply to young adults, under the Fast Food Industry Award, as follows: Age and experience % of minimum rate 18 years of age and employed by the employer for 6 months or less 70% 19 years of age and employed by the employer for 6 months or less 80% 20 years of age and employed by the employer for 6 months or less 90% All other junior employees aged 18 years of age or older (i.e. those employed by the employer for more than 6 months) 100% [2026] FWCFB 75 274 The Pharmacy Industry Award [1063] We will once again first set out how we weighed the considerations in relation to minors. We will then deal with adult junior employees. Minors [1064] We have again weighed section 284(1)(e) most heavily in our consideration in relation to junior employees who are minor. That limb requires us to take into account providing a comprehensive range of fair minimum wages to, inter alia, junior employees, in establishing and maintaining a safety net of fair minimum wages. The matters we have referred to above, including, inter alia, the greater labour market disadvantage of minors, the different constraints on them, and the benefits associated with being able to get a foot in the door of the labour market, in our view mean that they should have the benefit of being able to accept special, discount rates. In our view the junior rates provisions benefit minors. That benefit should be continued. We have taken into account all of the other mandatory considerations under ss 134 and 284, as well as the Act’s objects and the NMWO. In our view, again, the preponderance of these considerations, and the overarching consideration of fairness, weigh strongly in favour of this award providing for discount rates for junior employees who are minors. [1065] In light of the foregoing, and having undertaken a broad, evaluative process, weighing the mandatory considerations and taking into account, inter alia, the objects of the Fair Work Act, we are not satisfied that varying the rates paid to junior employees who are minors under the Pharmacy Industry Award is necessary to achieve the modern awards objective, or to achieve the minimum wages objective. Given this finding, as stated above, it has not been necessary for us to decide whether we are satisfied that variation is justified for work value reasons. [1066] In light of our finding we have decided not to make a determination varying the rates payable to junior employees who are minors. Young adults [1067] We took the same approach to weighing the mandatory considerations as we had done for the other two awards under consideration in these proceedings. [1068] We have referred to the parties’ submissions as to the modern awards and minimum wages objectives above. In contrast to the Ai Group, which took the approach that this case was predominantly about issues other than work value, the Pharmacy Guild’s written outline was largely devoted to work value issues. In their oral closing submissions, the Pharmacy Guild submitted that when the junior rates variation was made in 2017,942 the award met the modern awards objective and nothing has changed. The variation to junior rates in that decision was a consent variation that the Commission accepted was necessary to achieve the modern awards objective. We do not consider that consent variation requires us to start with any presumption as to the necessity or otherwise of further variation to meet the modern awards objective. 942 [2017] FWCFB 3540. [2026] FWCFB 75 275 [1069] In weighing the considerations in the context of this award, we have again taken into account the fairness of the safety net, including but not limited to whether the minimum wages reflect the value of the work, and whether it would be fair to allow young adults to accept lower wages to assist them in overcoming labour market disadvantage. We have taken into account that inexperienced young adults are likely to have greater disadvantages than those who have experience. We have taken into account the potential employment effects of increasing rates payable to young adults relative to both minors and other adults. We have taken into account the likely impacts on business, particularly in relation to likely impacts on costs. In doing so we have had regard to the varying sizes and geographic locations of businesses, and we have taken into account impacts on small and medium businesses. We have also taken into account fairness to employers, noting that employers in the industry vary in size and circumstances. To mitigate the impacts on both junior employees and business we intend to implement variations to the rates for young adults over time, by including transitional arrangements in our determination when made. Given the expert evidence, we consider the variations sought by the SDA would likely have limited impact on the national economy, and less of an impact than the variations to the other two awards the subject of these proceedings. Again, in any event, any impacts on the national economy will also be mitigated by including transitional arrangements in the determinations when made. [1070] The considerations as to fairness and likely impacts on business have been weighed most heavily. We have also taken into account all of the mandatory considerations in each of the modern awards and minimum wages objectives, as set out above. However, having regard to our consideration, above, these remaining matters are of less relevance and have weighed less heavily in our decision. [1071] For the reasons above, and having weighed the mandatory considerations, we again do not consider that junior rates should apply to adult workers, which is to say, workers aged 18 or over, purely by reference to age. There should be a limited window for the use of junior rates for young adults, of six months, while the young adult gains experience at the entry level, to address labour market disadvantage. Otherwise, adult workers should be paid the adult rates. [1072] We are satisfied that varying the rates payable to junior employees aged 18, 19 and 20 is necessary to meet the modern awards objective and the minimum wages objective. [1073] We have also taken into account the Fair Work Act’s objects, and the National Minimum Wage Order. [1074] Having made the above findings we have decided to make a determination to vary the modern award minimum wages for junior employees, insofar as they apply to young adults, under Levels 1 to 2 in the Pharmacy Industry Award, as follows: Age and experience % of minimum rate 18 years of age and employed by the employer for 6 months or less 70% 19 years of age and employed by the employer for 6 months or less 80% 20 years of age and employed by the employer for 6 months or less 90% [2026] FWCFB 75 276 Age and experience % of minimum rate All other junior employees aged 18 years of age or older (i.e. those employed by the employer for more than 6 months) 100% No finding as to appropriateness of applying junior rates to higher classifications [1075] In the Pharmacy Industry Award, junior rates apply only to Levels 1 and 2, and not to classifications involving supervisory or managerial responsibility. The junior rates in the General Retail Industry Award and the Fast Food Industry Award attach to higher level positions. We think it prudent to be clear that we are not, by making this decision, expressing a view as to the desirability of either approach, or its consistency with the modern awards and minimum wages objective. Though we are not confined to the relief sought by the parties, we do not consider that altering the application of rates to particular classifications would be appropriate given the basis on which this case was argued. Conclusion and disposition [1076] For the reasons above we have decided to vary the junior rates provisions in each of the three awards so that junior rates do not apply to young adults other than inexperienced young adults. We have decided to use the same measure for experience as that presently reflected in the General Retail Industry Award for junior rates for employees aged 20, which is that the employee has been “employed by the employer for more than 6 months.” We have decided not to alter the junior rates applicable to employees aged under 18. [1077] Giving effect to this decision will involve making a determination (or determinations) to vary the relevant provisions of each of the three awards. However, before any such determination is made we will hear from the parties as to timing and transitional arrangements. Timing and transitional arrangements [1078] At the hearing we sought the parties’ views as to timing and transitional arrangements in the event the application was to be (wholly or partly) granted. The employer parties generally indicated they would prefer a further opportunity to be heard on such arrangements. [1079] The Pharmacy Guild, while maintaining its opposition to the application, indicated a preference for any changes to take effect simultaneously with annual wage review changes for administrative convenience having regard to the need to change payroll arrangements. This is consistent with s 166 of the Fair Work Act which provides that determinations varying modern award minimum wages generally commence operation on 1 July. However, we consider there may be some benefit to having the transitional arrangements take effect at intervals of less than a year. [1080] We have decided to provide a further opportunity to be heard as to the timing and transitional arrangements for the implementation of our decision. [2026] FWCFB 75 277 Provisional view as to implementation [1081] The following is our provisional view, as to implementation, including timing and transitional arrangements. We will provide a further opportunity to be heard in relation to this provisional view. [1082] On a provisional basis, we consider it appropriate to provide a period of some months prior to the determinations taking effect, to allow employers to make necessary preparations. We also consider this change should be introduced gradually over a period of up to four years, with a view to smoothing potential impacts on young people and the businesses that offer them employment opportunities. We consider that implementing the changes in increments of five percentage points, in intervals of around six months, would make for a smoother transition. For the greatest administrative convenience we consider that it is desirable for changes to take effect from the pay periods immediately following 1 December and 1 July. Our provisional view as to effective dates and proportions is summarised as follows: First pay period after: General Retail Industry Award, Fast Food Industry Award, Pharmacy Industry Award Age 18 (and employed by the employer for more than 6 months) 19 (and employed by the employer for more than 6 months) 20 (and employed by the employer for more than 6 months) Present percentages 70 80 90 1-Dec-26 75 85 95 1-Jul-27 80 90 Full adult rate 1-Dec-27 85 95 1-Jul-28 90 Full adult rate 1-Dec-28 95 1-Jul-29 Full adult rate [1083] Consistent with our decision, there would be no change to the junior rates for persons aged under 18, or for persons aged 18 to 20 who do not have more than six months’ experience, assessed by reference only to the period of employment with the current employer. Next steps and further order [1084] We have indicated that we will give parties an opportunity to be heard as to our provisional view in relation to implementation. Further directions will be issued in that regard. [1085] For the reasons set out above we also order that the confidentiality order dated 20 October 2025, PR792789, which related to the SDA’s lay witnesses, be varied to the extent necessary for consistency with this decision. DEPUTY PRESIDENT [2026] FWCFB 75 278 Appearances: W Friend KC, K Burke SC, J Tierney, and B Bromberg, counsel for the Shop, Distributive and Allied Employees Association, instructed by A J Macken & Co M Follett KC and M Moir, counsel for the Australian Industry Group J Tracey KC and F Leoncio, counsel for the (then) Australian Retailers Association, instructed by King & Wood Mallesons M Stirling and R Zorah of Master Grocers Australia S Wellard of Meridian Lawyers for the Pharmacy Guild of Australia J Arndt and T Lawrence of Australian Business Lawyers & Advisors for ABI & BNSW J Cullinan of Retail and Fast Food Workers Union Hearing details: Melbourne: 27-30 October, 4-7 November & 25-26 November 2025. Printed by authority of the Commonwealth Government Printer <PR798175> Attachment A: witnesses SDA’s lay witnesses The SDA’s lay witnesses were referred to by their initials, in accordance with a confidentiality order made in these proceedings. The SDA provided the following table showing the pseudonyms. It also shows which of the three Modern Awards each witness had worked under. Some witnesses had worked under more than one of the Modern Awards. Witness pseudonym General Retail Industry Award Fast Food Industry Award Pharmacy Industry Award State/ Territory WA x TAS KB x NSW CB x SA PB x TAS RB x x NSW AB x x SA [2026] FWCFB 75 279 Witness pseudonym General Retail Industry Award Fast Food Industry Award Pharmacy Industry Award State/ Territory BB x x SA BCA x NSW DC x VIC BC x NSW CC x QLD CCR x WA LC x NSW TOC x NSW RD x x SA KD x NSW JE x WA OE x WA PF x x VIC LG x VIC MG x SA JG x NSW JH x VIC CH x NSW YH x NSW SH x NT IH x x SA AI x VIC KJ x WA JKA x SA JK x NSW CK x x SA TL x SA SL x NSW SLU x VIC EL x VIC BM x QLD CM x QLD MM x QLD KM x NSW AM x x SA SM x SA EM x WA [2026] FWCFB 75 280 Witness pseudonym General Retail Industry Award Fast Food Industry Award Pharmacy Industry Award State/ Territory JM x SA DM x VIC MO x QLD KP x NSW JP x SA JPH x WA BQ x WA AT x WA JT x QLD AW x WA MW H x WA MW x VIC TW x x SA LW x NSW ZWI x WA MM C x SA BW x WA Ai Group’s lay witnesses • Mr Nathan Carrington, Head of Corporate Operations ANZ, Domino’s Pizza Enterprises Ltd; • Ms Jennifer de Witte, an Employee Relations Consultant, Craveable Brands (which operates Red Rooster, Oporto, Chicken Treat, and Chargrill Charlie’s); • Mr Tim Humphreys, sole director of the trustee for Humphreys Family Trust, a franchisee of Craveable Brands operating Red Rooster restaurants; • Ms Christine Bletsas, Chief Financial Officer, Hungry Jack’s Pty Ltd; • Ms Robyn Johnston, State People & Culture Partner (South Australia, Northern Territory, and Tasmania), Hungry Jack’s Pty Ltd; • Mr Samuel Morton, General Manager – Western Australia, Hungry Jack’s Pty Ltd; • Mr Christopher Turner, Director – Workplace Relations and Safety, McDonald’s Australia and New Zealand, McDonald’s Australia Limited; • Ms Christine Wallace-Hughes, Director of McOpCo, McDonald’s Australia Limited; • Mr Matthew Beattie, Head of Restaurant Finance North & East, McDonald’s Australia Limited; and • Ms Mandy Sharp, People Director – Restaurant People Partner, McDonald’s Australia Limited, and CEO of McDonald’s Registered Training Organisation. ARA’s lay witnesses • Ms Fleur Brown, Chief Industry Affairs Officer, ARA; • Ms Emma Bridges, General Manager - Operations, Strategy Delivery and Capability within Central Operations, for Coles Supermarkets Australia Pty Ltd; and • Ms Belinda Cousens, State Operations Manager – NSW, Kmart Group. [2026] FWCFB 75 281 MGA’s lay witnesses • Mr Anthony Bongiovanni, a liquor store proprietor; • Ms Slavka Koch, an independent supermarkets proprietor; and • Mr Bruce Luchterhand, an independent supermarket proprietor Pharmacy Guild’ lay witnesses • Ms Amanda Chisholm, Group General Manager of a firm with nine community pharmacies located across South Australia, the Northern Territory, Tasmania, and Queensland; • Ms Jessica Knight, Human Resources Partner for a network of seven community pharmacies located in Far North Queensland; • Mr Robert King, a pharmacist and proprietor of five TerryWhite Chemmart pharmacies, in New South Wales and South Australia; • Mr Quinn On, a pharmacist and proprietor of three pharmacies in New South Wales • Mr Wisam Zoghbi, pharmacist, and a proprietor of four pharmacies in New South Wales; and • Ms Vaneeta Kennedy, a pharmacist, and a partner of two community pharmacies in New South Wales. Expert witnesses Called by the SDA: • Prof Jeff Borland • Prof Martin O’Brien Called by the Ai Group: • Prof Philip Lewis • Dr Dean Hyslop Called by the ARA: • Prof Richard Holden