Appeals against a decision of the Commission in Matter No. APPL 66 of 2012 and appl 24 of 2014 given on 15 May 2015 WESTERN AUSTRALIAN INDUSTRIAL RELATIONS COMMISSION FULL BENCH CITATION : 2015 WAIRC 01042 CORAM :The Honourable J H Smith, Acting President Chief Commissioner A R Beech Acting Senior Commissioner P E Scott HEARD : Wednesday, 28 October 2015 DELIVERED : TUESDAY, 24 NOVEMBER 2015 FILE NO : FBA 4 OF 2015 BETWEEN : The Australian Rail, Tram and Bus Industry Union of Employees, West Australian Branch Appellant AND Public Transport Authority of Western Australia Respondent AND FILE NO : FBA 5 OF 2015 BETWEEN : The Australian Rail, Tram and Bus Industry Union of Employees, West Australian Branch Appellant AND Public Transport Authority of Western Australia Respondent ON APPEAL FROM: Jurisdiction : Western Australian Industrial Relations Commission Coram : Commissioner S J Kenner Citation : [2015] WAIRC 00377; (2015) 95 WAIG 711 File Nos : APPL 66 of 2012 and APPL 24 of 2014 CatchWords : Industrial Law (WA) - Applications to vary awards to restore relativities between classifications and as between classifications and the minimum wage - Compression of wage relativities - Orders sought to vary award rates to reflect percentage increases of adjustments to the state minimum wage - National Wage Decisions and State Wage Decisions considered - Applications dismissed at first instance - No error demonstrated Legislation : Industrial Relations Act 1979 (WA) s 6(ca), s 26, s 26(1)(a), s 26(1)(c), s 40, s 49, s 50, s 50A, s 50A(3), s 50A(3)(a)(ii), s 50A(7), s 51, s 51(2) Labour Relations Legislation Amendment Act 2006, Act No 36 of 2006 (WA) s 14, s 15 Workplace Relations Act 1996 (Cth) s 88B(2) Result : Appeals dismissed Representation: Counsel: Appellants : Mr M T Ritter SC Respondents : Mr D J Matthews Solicitors: Appellants : W G McNally Jones Staff Respondents : State Solicitor for Western Australia Case(s) referred to in reasons: Coal & Allied Operations Pty Ltd v Australian Industrial Relations Commission [2000] HCA 47; (2000) 203 CLR 194 Gronow v Gronow [1979] HCA 63; (1979) 144 CLR 513 House v The King [1936] HCA 40; (1936) 55 CLR 499 Public Transport Authority of WA v The Australian Rail, Tram and Bus Industry Union of Employees, West Australian Branch [2006] WAIRC 04051; (2006) 86 WAIG 807 Robe River Iron Associates v The Amalgamated Metal Workers and Shipwrights' Union of Western Australia (1993) 73 WAIG 1993 The Australian Rail, Tram and Bus Industry Union of Employees, West Australian Branch v Public Transport Authority [2006] WAIRC 03895; (2006) 86 WAIG 457 Case(s) also cited: Commission's Own Motion v (Not Applicable) [2014] WAIRC 00471; (2014) 94 WAIG 641 Dornan v Riordan (1990) 95 ALR 451 On the Commission's Own Motion [2015] WAIRC 00435; (2015) 95 WAIG 679 Re Croser; Ex parte Rutherford [2001] WASCA 422; (2001) 25 WAR 170 The Australian Rail, Train and Bus Industry Union of Employees, West Australian Branch v Public Transport Authority of Western Australia [2015] WAIRC 00378; (2015) 95 WAIG 712 Trades and Labor Council of Western Australia v Minister for Consumer and Employment Protection [2006] WAIRC 04608; (2006) 86 WAIG 1633 === REASONS FOR DECISION === ¶1 SMITH AP: ¶2 Introduction ¶3 These are two appeals instituted pursuant to s 49 of the Industrial Relations Act 1979 (WA) (the Act) against decisions made by the Commission to dismiss applications brought by The Australian Rail, Tram and Bus Industry Union of Employees, West Australian Branch (the union) in APPL 66 of 2012 and APPL 24 of 2014. The applications were made under s 40 of the Act to vary the Railway Employees' Award No 18 of 1969 (the Railway Employees' Award) and the Public Transport Authority Rail Car Drivers (Transperth Train Operations) Award 2006 (the Rail Car Drivers Award) pursuant to principle 10 of the State Wage Fixing Principles ([2014] WAIRC 00485; (2014) 94 WAIG 652). The applications were joined as they raised substantially the same issues ([2014] WAIRC 01031; (2014) 95 WAIG 711). ¶4 Principle 10 of the 2014 Principles provided: 10.1 An application or reference for a variation in wages which is not made by an applicant under any other Principle and which is a matter or concerns a matter to vary wages above or below the award minimum conditions may be made under this Principle. This may include but is not limited to matters such as equal remuneration for men and women for work of equal or comparable value. 10.2 Claims may be brought under this Principle irrespective of whether a claim could have been brought under any other Principle. 10.3 All claims made under this Principle will be referred to the Chief Commissioner for him to determine whether the matter should be dealt with by a Commission in Court Session or by a single Commissioner. ¶5 In both matters the union sought to restore relativities as at 2006. In particular, they sought to restore: (a) wage relativity between classifications contained in the awards; and (b) wage relativity of both awards to the minimum wage. ¶6 The applications were made on grounds that flat dollar adjustments to the awards since 2006 have compressed the classification relativities within the awards, and as against the state minimum wage. The variations sought by the union reflect the sum total percentage increases awarded to the state minimum wage since 2006. The union contended at first instance and on appeal that the effect of the compression of wage relativities in both awards has led to unfair wage structures and devalued employees' skills. ¶7 The respondent, the Public Transport Authority of Western Australia (the PTA), opposed the union's applications to vary the awards. It argued that: (a) the union is effectively seeking to vary State Wage orders contrary to s 50A(7) of the Act to apply a percentage outcome, in substitution of the flat dollar amount determined by the Commission; (b) the union's claims have failed to consider the wages paid to the employees covered by these awards under the various industrial agreements and orders since 2006; (c) the awards have already been modernised once and the applications make no work value claims; (d) the applications seek to increase the wage rates so that the awards will become a competitive base from which to bargain, which outcome is contrary to s 26 and the objects of the Act; and (e) the variation to the awards would have a flow-on effect across the state government and the private sector, and would have the effect of undermining the considerations the Commission has had regard to in State Wage Decisions since 2006. [The union's evidence at first instance] ¶8 The union tendered into evidence tables which it says show the compression of relativities in the awards relative to the award classifications and to the minimum wage (exhibit A1 and exhibit A2). ¶9 The union argued that wage relativities are essential to setting fair wage structures within any given award. This, it says, is because wage relativities reflect the responsibilities and skills of a job. As the relativities between classifications in both awards have compressed and relativities between the classifications contained in both awards have compressed to the minimum wage, it contends that this has led to unfair wage structures and has had the effect of devaluing skills. To restore the relativities it seeks that each State Wage Decision increases be applied as a percentage to increase the rates contained in each of the awards. ¶10 The table in exhibit A1 relates only to the rates of pay payable to a rail car driver in each year from 2006 until 2014. This table is as follows: Year : Railcar Drivers Award Base Rate if given same percentage increase in SWO as a minimum wage 2006 : $978.82 2007 : $1025.41 2008 : $1081.70 2009 : $1105.50 2010 : $1139.55 2011 : $1178.18 2012 : $1218.24 2013 : $1253.57 2014 : $1292.43 *Sources" WAIRC Wage Case Site and Department of Treasury Consumer Price Index Archives The figures in red show what the Railcar Drivers Base Rate should be if indexed in line with SWO percentages and not CPI From 2006 – 2014 the minimum wage grew by 37.58% ($484.00 - $665.90) From 2006 – 2014 the Railcar Drivers Award grew by only 20.95% ($940.00 - $1137.00) ¶11 The tables in exhibit A2 deal with each of the classifications in both awards and shows the rates of pay only in 2006 and 2014. These tables show the differences in internal relativities to each classification in the awards and to the minimum wage. These tables are as follows: Compression of relative Award Classifications RAILCAR DRIVERS AWARD : Difference Trainee Railcar Drivers : -8.27% Railcar Drivers : -7.03% Driver Trainers : -7.09% Driver Coordinators : -7.11% RAILWAY EMPLOYEES AWARD : Difference REA Level 1 : -2.94% REA Level 2 : -3.80% REA Level 3 : -4.43% REA level 3A : -4.83% REA Level 4 : -5.16% REA Level 5 : -5.60% REA Level 6 : -5.89% REA Level 7 : -4.13% REA Level 8 : -6.63% REA Level 9 : -6.78% REA Level 10 : -6.89% ¶12 The union points out that exhibit A2 shows that: (a) the compression of internal wage relativities between classifications has removed the incentive for employees to train and be trained. It has also reduced the gains from acquiring skills and it follows that for higher skilled workers this means the value of their skills over time has been lost; (b) the internal wage relativity between driver trainers and rail car drivers has eroded by 0.87%. This it says represents a 0.87% reduction in the value of a driver trainer's skills relative to a rail car driver; (c) the internal wage relativity between driver coordinators and rail car drivers has eroded by 1.73% and this represents a 1.73% reduction in the value of a driver coordinator's skills relative to a rail car driver; (d) for employees engaged under the Railway Employees' Award levels 5, 6, 8, 9 and 10 internal wage relativities have eroded in relation to the level 4 base rate. In particular, it shows that: (i) level 5 lost 0.94% on its base rate to the level 4 base rate; (ii) level 6 lost 1.70% on its base rate to the level 4 base rate; (iii) level 8 lost 4.57% on its base rate to the level 4 base rate; (iv) level 9 lost 5.55% on its base rate to the level 4 base rate; and (v) level 10 lost 6.50% on its base rate to the level 4 base rate. (e) conversely internal relativities between the base rate for levels 1, 2, 3, 3A and 7 have increased to that of the level 4 base rate as follows: (i) level l gained 2.97% on its base rate to the level 4 base rate; (ii) level 2 gained 2.03% on its base rate to the level 4 base rate; (iii) level 3 gained 1.20% on its base rate to the level 4 rate; and (iv) level 7 gained 0.67% on its base rate to the level 4 rate. ¶13 The contention which is central to the union's claims in respect of both awards is that it says the flat dollar increases awarded by each State Wage Decision from 2006 to 2014 have led to an erosion of relativities between the base rate in each award and the minimum wage. The extent of this erosion it says is demonstrated in the tables in exhibit A2 which shows the minimum wage as a percentage of each of the award classifications for the Rail Car Drivers Award and the Railway Employees' Award. ¶14 The union points out that exhibit A2 shows that the loss of relativity between the base rates contained in the Rail Car Drivers Award and the minimum wage as follows: (a) trainee rail car drivers' base rate has got closer to the minimum wage by 8.27%; (b) rail car drivers' base rate has got closer to the minimum wage by 7.03%; (c) driver trainers' base rate has got closer to the minimum wage by 7.09%; and (d) driver coordinators' base rate has got closer to the minimum wage by 7.11%. ¶15 It also makes a similar submission in respect of the Railway Employees' Award. It points out that there is a loss of relativity between the base rates contained in the Railway Employees' Award and the minimum wage as follows: (a) level l base rate has got closer to the minimum wage by 2.94%; (b) level 2 base rate has got closer to the minimum wage by 3.80%; (c) level 3 base rate has got closer to the minimum wage by 4.43%; (d) level 3A base rate has got closer to the minimum wage by 4.83%; (e) level 4 base rate has got closer to the minimum wage by 5.16%; (f) level 5 base rate has got closer to the minimum wage by 5.60%; (g) level 6 base rate has got closer to the minimum wage by 5.89%; (h) level 7 base rate has got closer to the minimum wage by 4.13%; (i) level 8 base rate has got closer to the minimum wage by 6.63%; (j) level 9 base rate has got closer to the minimum wage by 6.78%; and (k) level 10 base rate has got closer to the minimum wage by 6.89%. ¶16 Thus, the flat dollar amounts awarded in the past have led to higher skilled workers under the Rail Car Drivers Award and the Railway Employees' Award falling closer to the minimum wage. ¶17 Three witnesses gave evidence on behalf of the union. Mr Paul Robinson, the secretary of the union, gave evidence about his opinion of the effect of flat dollar increases to the awards since 2006. He said the handing down of flat dollar increases based on a minimum wage in other awards is unfair to awards that have classifications set by skill level as the effect is to keep the rates of pay low. Mr Robinson spoke about rail car drivers returning to the Rail Car Drivers Award from early 2008 to late 2010 when they were unable to reach agreement with the PTA to enter into a new industrial agreement. The reason why the union decided to return to the award at that time was because the difference between the rates of pay in the industrial agreement that had expired and the award at that time was only about $2. Yet, returning to the award provided improved conditions to rail car drivers. ¶18 Mr Robinson said that if the applications to increase the rates of pay is granted, that the rates of pay specified in the awards would improve the bargaining process as that would put pressure on both parties to reach a new industrial agreement. ¶19 Mr John Harold Olding, the sub-branch secretary to the customer service area, gave evidence that there used to be a separate skills allowance in the award. That was merged into 'all up' rates of pay in an industrial agreement. When the award was modernised in 2006 the 'all up' rates became the rates of pay in the award. He said that since 2006 the rate of pay in the Railway Employees' Award has not provided a safety net for employees as the levels of award rates in the award have not kept up to date with the industrial agreement rates of pay. This he says has had an effect on the skills allowance which, has in effect, become diluted over time. ¶20 Mr Raymond Arthur Debenham, a rail car driver and had been until recently the rail car driver sub-branch secretary, gave evidence that the award must remain relative or relevant in that it must have competitive award rates to the industrial agreements because if the gap between the rates of pay are too big they will not be in a position to drive future bargaining with the PTA. [The PTA's evidence at first instance] ¶21 The PTA did not call any witnesses to give evidence. It did, however, tender into evidence a number of exhibits, including exhibit R2 which is a comparative table of award weekly wage rates for the Rail Car Drivers Award and the Railway Employees' Award. This table shows the wage rates and internal relativities in 2006 and 2014. In the fourth last column it shows the amount of the award rates if a percentage of 25.93% was applied, being the rate of change in the consumer price index for Perth from 1 July 2006 to 1 July 2014. The third last column in the table shows the amount of the award rates if the 2006 percentage relativities were applied to the base rate of pay of each award (* reference rates). The second last column in the table shows the rates of pay that would be applied if 37.5% sought by the union were to be applied to the 2006 rates of pay. The rates sought by the union maintain internal relativities to 2006 rates by applying each increase in the State Wage as if each had been awarded by the Commission in Court Session as a percentage increase rather than a flat increase. The table in exhibit R2 is as follows: AWARD WEEKLY WAGE RATES – COMPARATIVE TABLE Award : Current Agreement Base Rates Paid -RCD and ITO Agreements -(Adjusted for 38 hour week) Both : NA RCD : $1,524.60 RCD : $1,381.30 RCD : $1,303.10 RCD : $1,079.90 REA : $1,051.48 REA : $1,026.10 REA : $965.97 REA : $908.19 REA : $866.41 REA : $820.33 [Relevant State Wage and National Wage Decisions which dealt with compression of relativities] ¶22 Until 2006, s 51(2) of the Act (now repealed) required the Commission in Court Session, unless it was satisfied there were good reasons not to do so, to make a General Order to adjust the rate of wages paid in awards by the amount of change to wages in each National Wage Decision and adopt in whole or in part and with or without any modification any principle, guideline, condition or other matter having effect under the National Wage Decision. Section 51 was repealed by s 15 of the Labour Relations Legislation Amendment Act 2006, Act No 36 of 2006 (WA). ¶23 In 2006 and prior to s 51 being repealed there was no National Wage Decision as the power to make an order determining wages within the national system had been by legislative amendment to the Workplace Relations Act 1996 (Cth) transferred to the Australian Fair Pay Commission. ¶24 The effect of compression by the award of flat dollar increases was comprehensively dealt with by a Commission in Court Session in 2006. ¶25 In the 2006 State Wage Decision the following observations were made by the Commission in Court Session and in various national wage decisions considered by the Commission in Court Session in that matter which are relevant to the disposition of issues raised in these appeals ([85] - [97]): (a) flat dollar increases to minimum awards were consecutively awarded after 1991 ([85], [89]); (b) considerations of cost are a ground for flat dollar increases ([85]); (c) there is a tension between the maintenance of relativities and addressing the needs of the employees at the lower award levels ([87]); (d) relativities remain an important determinant of the fairness of the minimum wage structure within awards. Awards cannot be fair unless they properly reflect the relative skills, responsibilities, etc of jobs covered by the award. Provision of skill-based career structures in awards is a significant way in which employees are encouraged to improve their skills, contribute to higher productivity and advance to higher wages ([86]); (e) in 1997 the Australian Commission observed that percentage increases are a means of maintaining existing relativities in skill-based classification structures, but given the need to limit average weekly ordinary time earnings (AWOTE) and weighing the desirability of relativity preservation with the needs of the low paid flat dollar increases have been awarded by giving priority to the needs of the low paid ([86]); (f) in 1998 and in 1999 the Australian Commission, after having regard to the fact that flat dollar increases distort vertical relativities by reducing relativities in percentage terms, tapered the amount of the flat dollar increases at the higher level. This approach and form of increases strikes the right balance between the competing equity of lessening the effect of compression and cost considerations ([87] - [88]); (g) in 2001 the Australian Commission awarded three incremental flat dollar increases as a measure towards avoiding the further compression of relativities between job classifications (PR002001); ¶26 In 2006 the Commission in Court Session found: (a) unlike the Australian Commission under the repealed s 88B(2) of the Workplace Relations Act ([92] - [97]) it is not expressly required to pay regard to the needs of the low paid; but such a consideration is implied as a matter the Commission can consider within the scope of the principal object in s 6(ca) of the Act, in s 26(1)(a) and the opening words of s 26(1)(c) where such a consideration is raised on the evidence before it ([94]); (b) a flat dollar increase on this occasion will target the lower paid; (c) although the Australian Commission held in September 1994 and in October 1995 that it would not grant applications to restore pre-existing relativities on the basis that such relativities have been compressed by flat dollar increases, this Commission is not necessarily bound to follow the Australian Commission decisions in respect of this issue; (d) if any party to an award wishes in the future to address the issue that compression of wage rates since 1991 as a result of flat dollar arbitrated safety net adjustments has eroded skill-based career paths in awards or had any other detrimental effect at the industry or workplace level, it is open to them to do so in an application relating to a specific award under s 40 of the Act. ¶27 Within days of the 2006 State Wage Decision being delivered on 26 June 2006, s 14 of the Labour Relations Legislation Amendment Act came into operation on 4 July 2006. These amendments repealed the direct nexus between a National Wage Decision and a State Wage Decision. Section 14 enacted s 50A(3) of the Act which requires the Commission in Court Session when making a General Order to: In making an order under this section, the Commission shall take into consideration — (a) the need to — (i) ensure that Western Australians have a system of fair wages and conditions of employment; (ii) meet the needs of the low paid; (iii) provide fair wage standards in the context of living standards generally prevailing in the community; (iv) contribute to improved living standards for employees; (v) protect employees who may be unable to reach an industrial agreement; (vi) encourage ongoing skills development; and (vii) provide equal remuneration for men and women for work of equal or comparable value; (b) the state of the economy of Western Australia and the likely effect of its decision on that economy and, in particular, on the level of employment, inflation and productivity in Western Australia; (c) to the extent that it is relevant, the state of the national economy; (d) to the extent that it is relevant, the capacity of employers as a whole to bear the costs of increased wages, salaries, allowances and other remuneration; (e) for the purposes of subsection (1)(b) and (c), the need to ensure that the Western Australian award framework represents a system of fair wages and conditions of employment; (f) relevant decisions of other industrial courts and tribunals; and (g) any other matters the Commission considers relevant. ¶28 The Commission in Court Session did not revisit this issue in its 2007 State Wage Decision ([2007] WAIRC 00517; (2007) 87 WAIG 1487). Nor did it in 2008, although it did acknowledge submissions made to it regarding the compressing effect upon relativities of successive flat-dollar increases to award rates ([2008] WAIRC 00347; (2008) 88 WAIG 773 [43]). ¶29 The Commission in Court Session made no further observations about this issue until 2012 when it awarded a percentage increase to awards. It did so on two grounds. Firstly, because they 'appreciated' that past flat-dollar increases inevitably will have had the effect of compressing relativities between wage rates in awards and secondly there are employers and employees in Western Australia who are award-reliant ([2012] WAIRC 00346; (2012) 92 WAIG 557 [112]). I understand the term award-reliant to mean employers and employees who have not entered into industrial agreements. ¶30 In 2013, the Commission in Court Session simply said that ([2013] WAIRC 00347; (2013) 93 WAIG 467 [86]): (a) on this occasion they favoured a flat-dollar increase rather than a percentage increase. This is in a large part due to the emphasis they wish to place upon those employees who are on the minimum wage or slightly above it, rather than those on higher award wages; and (b) there was no direct evidence of issues having arisen from any compression of award relativities from past flat-dollar increases. ¶31 In 2014, they said that they again favoured a flat-dollar increase rather than a percentage increase because ([2014] WAIRC 00471; (2014) 94 WAIG 641 [103], [106]): (a) they considered a flat increase targets those employees who are on a minimum wage or slightly above it; (b) a flat increase has the potential to result in a lower overall cost to an employer compared to a percentage adjustment because the increase is not compounded when applied to award rates of pay; (c) there was no direct evidence of issues having arisen from any compression of award relativities from past flat-dollar increases; and (d) it is open to any party to seek to vary an award to address issues which arise from any compression of relativities. ¶32 After the decisions dismissing APPL 66 of 2012 and APPL 24 of 2014 were delivered, the Commission in Court Session delivered the 2015 State Wage Decision ([2015] WAIRC 00435; (2015) 95 WAIG 679). At [111] - [113] it found: (a) flat-dollar increases to award rates of pay are generally preferred because a flat increase targets those employees who are on the minimum wage or slightly above it and has the potential to result in a lower overall cost to an employer compared to a percentage adjustment because the increase is not compounded; (b) they were aware that over time flat-dollar increases compress award relativities; (c) a percentage increase to award wages would be awarded. On this occasion, UnionsWA has demonstrated the level of compression at higher wages levels in the Metal Trades (General) Award 1966; (d) awarding a percentage increase will give a greater increase to higher award rates than the minimum wage, and a corresponding cost to employers; and (e) it is open to any party to seek to vary an award to address issues which arise from the compression of relativities. [Reasons for decision of the Commission at first instance] [(a) Compression of wage relativities - principles] ¶33 The learned Commissioner, hearing the applications the subject of these appeals, considered the observations of the Commission in Court Session in the State Wage Decision in 2006 ([2006] WAIRC 04608; (2006) 86 WAIG 1633), the State Wage Decisions in 2011 ([2011] WAIRC 00399; (2011) 91 WAIG 1008) and 2014 ([2014] WAIRC 00471; (2014) 94 WAIG 641). He then observed that the Commission in Court Session had found that it is open to any party to seek to vary an award to address issues which arise from any compression of relativities. The learned Commissioner also observed that: (a) in successive State Wage Decisions the Commission in Court Session has recognised that awarding flat dollar increases to the state minimum wage and in turn, extending that increase to award wages generally, will have the effect of compressing relativities in awards; and (b) since 2006, and except for 2012, the Commission in Court Session has awarded flat dollar increases to the state minimum wage. It has done so on the basis the flat dollar increases will tend to favour the lowest paid, and hence, is consistent with the Commission in Court Session meeting its statutory obligation to 'meet the needs of the low paid' under s 50A(3)(a)(ii) of the Act. ¶34 The learned Commissioner found that the Commission in Court Session has repeatedly said that in any case where it is contended that the compression of relativities in a particular award or awards has had a detrimental effect then an application can be made under s 40 of the Act to address it and be heard by a single Commissioner after conferring with the Chief Commissioner in accordance with principle 10.3 of the Principles. ¶35 The learned Commissioner then found, after having regard to principle 10 of the 2014 Principles, that there was no barrier to these matters being dealt with by an application under s 40 of the Act, consistent with the Principles. Further, he accepted, based on the materials before him, that in both awards there has been, since 2006, a degree of compression of relativities within the classifications prescribed by both awards. He then found that taking the original relativities in 2006 as the benchmark, the compression is relatively small for rail car drivers and is considerably greater for those from level 5 and above under the Railway Employees' Award. He also found for those in level 3A and below in the Railway Employees' Award, the relativity to the level 4 rate has somewhat improved over the same period. The learned Commissioner then said the question was in these matters whether this should be remedied and, if so, how. [(b) State minimum wage determination] ¶36 The learned Commissioner found that he was not persuaded that there is any merit in the view that there should be established a nexus between cumulative state minimum wage movements, expressed in percentage terms, and the adjustment of all award classification rates in the awards. ¶37 In making this finding, the learned Commissioner had regard to the following matters: (a) In making a State Wage Decision, the Commission in Court Session is required by s 50A to have regard to a number of statutory criteria set out in s 50A(3) of the Act. (b) An important factor that the Commission in Court Session has paid particular attention to in the past, is the needs of the low paid. (c) Despite the adoption of flat dollar adjustments to the state minimum wage in past years, there has never been any recognition by the Commission in Court Session of a direct relationship between equalising percentage adjustments in the state minimum wage and the adjustments of award rates of pay generally. (d) If the union's claim to increase the base rates of pay in the awards by the cumulative percentage increase in the state minimum wage were to be granted, it is not difficult to envisage a flow of such applications to the Commission, therefore having the potential to undermine the integrity of the state minimum wage adjustment process, and the specific criteria set out in s 50A(3) of the Act, in particular, the criteria of meeting the needs of the low paid. (e) Exhibit R2 shows that for employees under the Railway Employees' Award up to level 7, the award wage rates have increased by more than the consumer price index from 2006 to 2014. If an objective of setting a minimum wage is to at least preserve the real value of wages, as referred to by the Commission in Court Session in the 1981 State Wage Case, then this objective is met in respect of this group of employees (State Wage Case (1981) 61 WAIG 1894). However, increases to the Railway Employees' Award levels 8 to 10 have achieved somewhat less than cumulative consumer price index over this time, but not substantially so. (f) For rail car drivers, from 2006 to 2014, each of the classifications have received between 4.93% and 6.83% less than the cumulative consumer price index figure. However, some caution needs to be applied to the measurement of the consumer price index, depending on whether the year-end or through the year rate is used for comparison purposes. Further, the base rate of wage for the Rail Car Drivers Award employees, as at 2006, is substantially higher than it otherwise would have been, by reason of the incorporation of rates of pay previously applying under industrial agreements. Additionally, the rate was increased by the incorporation of the SERA allowance in the base rates. (g) It is also significant to note that as exhibit R2 shows, the employees under both awards enjoy rates of pay, under their respective industrial agreements, with one or two exceptions, that are significantly higher than the respective rates of pay under the awards, adjusted for both cumulative consumer price index increases and the increases sought in the union's claim in these proceedings. [(c) Relativities, skill based career paths and minimum rates adjustment] ¶38 The learned Commissioner observed that the setting of properly established minimum rates and the creation of appropriate relativities between classifications in an award are important features of the system of wage fixation. He also observed that as the system of wage fixing developed in the 1990s, with an even greater focus on enterprise level outcomes, awards became the safety net below which terms and conditions of employment could not be adjusted. Nonetheless, the structural efficiency principle process for awards, remained important to ensure awards constituted a modern award safety net. ¶39 He then pointed out that both awards were modernised in 2006. The Rail Car Drivers Award was made as a new award on 24 February 2006 (The Australian Rail, Tram and Bus Industry Union of Employees, West Australian Branch v Public Transport Authority [2006] WAIRC 03895; (2006) 86 WAIG 457). The Railway Employees' Award was substantially modernised, through major variations, and was the subject of an order of the Commission on 17 March 2006 (Public Transport Authority of WA v The Australian Rail, Tram and Bus Industry Union of Employees, West Australian Branch [2006] WAIRC 04051; (2006) 86 WAIG 807). Both awards were made and varied respectively, by consent. ¶40 The Railway Employees' Award incorporated appropriate relativities with the metal trades award classifications set at level 4 as the benchmark classification, pegged at 100% of the metal trades tradesperson's rate. ¶41 The learned Commissioner observed that the Rail Car Drivers Award replaced the then Government Railways Locomotive Engineman's Award 1973. New rates of pay were struck and the new award containing classifications that had been payable under industrial agreements previously applying. As there had been very substantial changes to the industry up to that time, many of the classifications in the former Government Railways Locomotive Engineman's Award were obsolete and were removed. Given the higher rates of pay in the new Rail Car Drivers Award, incorporating rates from prior industrial agreements, including the former SERA allowance, he observed that the base rates of pay were considerably higher than those in the former Government Railways Locomotive Engineman's Award. Thus, he found the safety net for the employees covered by this award is already elevated. ¶42 The learned Commissioner then had regard to a decision he made in an application for an enterprise order applying to rail car drivers in 2011. In that arbitration a substantial body of evidence and submissions were put before the Commission in relation to terms and conditions of employment for rail car drivers. In that matter he had found that the wage rate (cl 18.5 - cl 18.7 of the Enterprise Order [2011] WAIRC 00218; (2011) 91 WAIG 730): (a) applicable to trainees should be 85% of the wage rate applicable to the classification of a rail car driver; (b) for a driver trainee was to be 6% above the applicable base rate for a rail car driver; and (c) for a driver coordinator was to be 17% above the applicable base rate for a rail car driver. ¶43 In the matters before him, he then observed that the principal contention of the union is that the base rates in the awards should be increased by the cumulative percentage increase in adjustments to the state minimum wage since 2006 and up to 2014 inclusive and that a substantial basis for each claim is to elevate the award base rates as a floor to bargain for an industrial agreement. ¶44 He found that the elevation of award base rates to achieve bargaining leverage is not a proper basis to restore award relativities. Further, he found that the purpose of restoration of relativities is to preserve the integrity of skill based career paths, based on the skills and responsibilities of classifications in an award. He then went on to observe that to the extent this factor may be relevant to the higher level classifications under the Railway Employees' Award, then any adjustment to relativities must be across the board, to preserve relativities and the integrity of the classification structure of the award and it was not open to the union to 'cherry pick', by only pursuing changes at the higher classification levels, whilst preserving the improvements in relativities at the lower classification levels. Thus, he found if there is to be a proper restoration of relativities it needs to reflect the structure of the award classifications, relative to the benchmark rate, as at 2006. [(d) The learned Commissioner's conclusion] ¶45 The learned Commissioner accepted that compared to the original relativities established in the Railway Employees' Award when it was modernised in 2006 (in particular for the higher level classifications) there has been some erosion of relativities to the key classification level 4 rate of pay. Therefore, he accepted that on this basis, those in higher skilled positions may be seen to have had the value of their work, relative to the established skills related career paths, in award terms at least, diminished. He then found the established relativities of the Railway Employees' Award, as at 2006, was the appropriate structure based on the metal trades classifications relativity. Further, he found if there was to be any restoration of relativities then they are the appropriate benchmark. ¶46 In the case of rail car drivers, he found the relativities as at 2006 have changed somewhat in the current rate structure, but only slightly. They were revisited by him in the extensive arbitration in the enterprise order proceedings. The learned Commissioner then expressed the view that the appropriate relativities should be as he determined in the enterprise order, but as the parties do not seek the application of those relativities, then they should not apply. ¶47 Finally, he found that notwithstanding his preliminary conclusions in relation to the basis of any adjustment to relativities, given his rejection of the central contention underlying the union's claims, and the parties' supplementary submissions, the most appropriate course was to dismiss both applications. He did, however, note that he would expect future claims, if any, to also encompass work value considerations. [The grounds of appeal] ¶48 The grounds of appeal in FBA 4 of 2015 are as follows: 2.1 The Commissioner erred in dismissing Appl 66 of 2012 (See 2015 WAIRC 00377) on the basis that there was no 'merit in the view that there should be established a nexus between cumulative [State Minimum Wage] movements, expressed in percentage terms, and the adjustment of all award classification rates in [the RCD Award]' (Reasons for Decision at [67]). 2.2 The Commissioner erred in dismissing Appl 66 of 2012 in circumstances where he did not provide adequate reasons for deciding there was no 'merit in the view that there should be established a nexus between cumulative [State Minimum Wage] movements, expressed in percentage terms, and the adjustment of all award classification rates in [the RCD Award]' (Reasons for Decision at [67]), in that the reasons provided did not support the conclusion reached. 2.3 The Commissioner erred in failing to properly decide the case of the Appellant in that having accepted there had been some erosion of relativities in the RCD Award (Reasons for Decision at [85]), the Commissioner did not decide whether that provided grounds upon which to vary the RCD Award, as sought by the Appellant, in the absence of the Appellant relying upon the outcome of the 'enterprise order proceedings' in 2010-2011 to restore the RCD Award based relativities (Reasons for Decision at [85]). ¶49 The grounds of appeal in FBA 5 of 2015 are as follows: 2.1 The Commissioner erred in dismissing Appl 24 of 2014 (See 2015 WAIRC 00377) on the basis that there was no 'merit in the view that there should be established a nexus between cumulative [State Minimum Wage] movements, expressed in percentage terms, and the adjustment of all award classification rates in [the RE Award]' (Reasons for decision at [67]). 2.2 The Commissioner erred in dismissing Appl 24 of 2014 in circumstances where he did not provide adequate reasons for deciding there was no 'merit in the view that there should be established a nexus between cumulative [State Minimum Wage] movements, expressed in percentage terms, and the adjustment of all award classification rates in [the RE Award]' (Reasons for decision at [67]), in that the reasons provided did not support the conclusion reached. 2.3 The Commissioner erred in dismissing Appl 24 of 2014 on the basis that the Appellant was trying to 'cherry pick' by only pursuing changes at the higher classifications levels in the RE Award, whilst preserving improvements in the relativities at the lower classification levels (Reasons for decision at [82]), when this was not the case of the Appellant, who sought orders which would preserve all of the classification relativities within the RE award. 2.4 The Commissioner erred in dismissing Appl 24 of 2014 in that he failed to properly decide the case of the Appellant as, having accepted there had been some erosion of relativities in the RE Award and that 'those in higher skilled positions may be seen to have had the value of their work, relative to the established skills related career paths, in award terms at least, diminished' (Reasons for decision at [83]), the Commissioner did not decide whether there should be, or alternatively provide adequate reasons for rejecting a variation to the RE Award, on that ground, to restore and preserve the integrity of skill based career paths, based on the skills and responsibilities classifications in the RE award. [The union's submissions in this appeal] ¶50 The basis of the applications before the Commission at first instance were that previous decisions of the Commission in Court Session in State Wage Decisions have indicated that there would be good grounds for the Commission to exercise its discretion under s 40 of the Act to vary an award if it were satisfied that: (a) there had been a compression in the relativities in an award; (b) the compression was caused by the flat dollar increases awarded in the State Wage Cases; and (c) the compression of relativities either: (i) eroded skill based career paths in awards; or (ii) had any other detrimental effect at the industry or workplace level. ¶51 The union argues that flat dollar adjustments to each of the awards since 2006 have compressed the classification relativities within the awards and as against the state minimum wage. This, they say, has led to an unfair wage structure and devaluation of employees' skills. In particular, unfairness has arisen because: (a) there is a compression of relativities between the state minimum wage and the rates of pay in each of the classifications in the awards; (b) there has been a compression internally in each award between the classifications in each award; and (c) award rate increases since 2006 as they apply to some classifications in the awards have not kept pace with the consumer price index. ¶52 In support of its argument, the union relies upon the observations made by the Commission in Court Session in the 2006 State Wage Case in which it adopted the observations of the Australian Industrial Relations Commission in the National Wage Case in 1997 in Print P1977 in which it held that relativities remain an important determinant of the fairness of the minimum wage structure within awards and it implicitly pointed out that: (a) award rates cannot be fair if they do not properly reflect the relative skills, responsibilities, etc of jobs covered by an award; (b) the provision of skill based career structures in awards is a significant way in which employees are encouraged to improve their skills, contribute to higher productivity and advance to higher wages; and (c) it was no answer to leave it to workplace agreements to establish appropriate relativities. ¶53 In ground 1 of the appeals, the union contends that the learned Commissioner erred in dismissing the applications by finding there was no merit in the view that there should be a nexus between cumulative state minimum wage movements, expressed in percentage terms, and the adjustment of the classification rates in the two awards. It argues that this finding was quite simply wrong; that there is clearly merit in the readjustment of the two awards to reflect the percentage increases made to the state minimum wage. The merit is to address the unfair rates of pay by maintaining the relativity between the minimum wage and the classifications in each of the awards, so as to value the skills held by the employees and provide financial rewards for the career paths covered by the awards and classifications. ¶54 The errors made by the learned Commissioner, the union says, are as follows: (a) The learned Commissioner erred in finding there was no merit in maintaining a nexus between the state minimum wage and the rates of pay in the classifications in the awards. One of the grounds he relied upon in making this finding was because it was envisaged that other unions may make similar applications to the Commission. The learned Commissioner was of the view that the applications had the potential to undermine the integrity of the state minimum wage adjustment process and the criteria of meeting the needs of the low paid. The learned Commissioner provided no explanation as to why he held this view. In any event, the needs of the 'low paid', to whom the minimum wage could apply, would not be affected if the applications were granted; to the contrary their interests are independent. (b) The learned Commissioner erred in finding that the considerations in s 50A of the Act did not support the applications. These are not criteria governing award variation applications under s 40 of the Act. As the Commission in Court Session in the 2015 State Wage Case ([2015] WAIRC 00435; (2015) 95 WAIG 679 [113]) said: It is open to any party to seek to vary an award to address issues which arise from the compression of relativities. An application to do so does not undermine this, or previous State Wage Order decisions and can be dealt with by a single commissioner. (c) The learned Commissioner erred in finding that the nexus argument had no merit because the employees covered by the awards had rates of pay in their respective industrial agreements which had been adjusted for cumulative consumer price index increases. The fact that employees had negotiated an industrial agreement, which took into account cumulative consumer price index increases, was not relevant to the issue about whether the award rates should have at least met the cumulative consumer price index increases. Thus, he took into account an irrelevant consideration. (d) In any event, there was unfairness in the compression itself. In fact, some of the rates in the awards had not kept pace with the consumer price index. (e) The learned Commissioner erred in finding that there was no merit in maintaining a nexus with the minimum wage because: (i) he envisaged that other unions may make similar applications; and (ii) the union's applications, if granted, had the potential to undermine the integrity of the state minimum wage adjustment process and the criteria of meeting the needs of the low paid. The union argues these findings are speculative. (f) The learned Commissioner clearly erred in finding that there was no merit in the view that there should be a nexus between cumulative state minimum wage movements, expressed in percentage terms, and the adjustment of the classification rates in the two awards, having accepted that the: (i) setting of properly established minimum rates and the creation of appropriate relativities between classifications in an award were important features of the system of wage fixation; (ii) objective of setting a minimum wage is to at least preserve the real value of wages; (iii) levels 8, 9 and 10 classifications in the Railway Employees' Award had received less than cumulative consumer price index increases as a result of flat dollar increases being made to the Railway Employees' Award; and (iv) classifications in the Rail Car Drivers Award received between 4.93% and 6.83% less than cumulative consumer price index increases as a result of flat dollar increases being made to the Rail Car Drivers Award. (g) It is irrelevant that the base rate of wages for rail car driver employees in the award as at 2006 were substantially higher than it would otherwise have been, by reason of the incorporation of rates of pay previously applying under industrial agreements. Those rates of pay were properly set rates of pay made by an order of the Commission. ¶55 In ground 2 of the appeals, the union alleges that the Commission did not provide adequate reasons about why there was no merit in the view that there should be established a nexus between cumulative state minimum wage movements, expressed in percentage terms, and the adjustment of all award classification rates in the awards the subject of these proceedings. However, senior counsel informed the Commission that if they succeed on ground 1 of the appeals, then ground 2 does not raise anything additional. However, if ground 1 of the appeals is rejected and there is a finding that the learned Commissioner's reasons at first instance are accepted, ground 2 of the appeals fall away. ¶56 Ground 3 of FBA 4 of 2015 and ground 4 of FBA 5 of 2015 raise substantially the same issues. Ground 3 of FBA 4 of 2015 is raised in respect of the application to vary the Rail Car Drivers Award and ground 4 of FBA 5 of 2015 is raised in respect of the applications to vary the Railway Employees' Award. The union's argument is that, having been satisfied that there had been some erosion of the relativities in each award as a result of flat dollar increases to the award rates, the learned Commissioner did not decide whether that provided grounds upon which to vary the awards. By failing to do so, the learned Commissioner did not properly exercise his discretion and decide the case before him. In particular, it is contended that once the learned Commissioner was satisfied that the flat dollar adjustments had eroded the relativities and skill related career paths, he ought to have amended the awards in the terms sought by the union, to correct that erosion. ¶57 It is also argued in FBA 4 of 2015, that when considering the compression of rates in the Rail Car Drivers Award, the learned Commissioner did not examine the compression issue separate from his findings in respect of the relativities he had found in the Enterprise Order case that he had heard in 2010 and 2011. At [85] of his reasons for decision the learned Commissioner, based on the evidence and history of negotiations between the parties, determined that the appropriate relativities should be as set out in the Enterprise Order. He then found, in his view, but for the supplementary submissions of the parties, they provide a cogent basis upon which any award base relativities should be restored. The union's supplementary submissions were that the Enterprise Bargaining Order proceedings were to reassess wage structures on a work-value basis and that that assessment was not applicable to their current applications, which were to restore award relativities. Thus, it says, the learned Commissioner was effectively saying that, but for that submission, there would have been a cogent basis upon which award base relativities should be restored. The union says the error the learned Commissioner made is that having said that, he then did not go on to consider whether the compressed relativities within the award of itself was a reason to grant the application. In particular, it says that what was not analysed by the learned Commissioner was whether the compression of the relativities within the award was a sufficient reason for granting the application in FBA 4 of 2015. ¶58 Ground 3 of FBA 5 of 2015 is raised only in respect of the Railway Employees' Award. In this ground of appeal the union claims the learned Commissioner erred because he misunderstood or misapplied the union's case. In dismissing the application, the learned Commissioner relied in part on a finding that the union was 'cherry picking' and 'only pursuing changes at the higher classification levels' in the Railway Employees' Award. The union says the point the learned Commissioner was making is that exhibit A2 shows there had been over time an improvement in relativities between the adult minimum wage and level 1 to level 3A and level 7 and at level 5, level 6 to level 10 there had been a decrease. To draw such a conclusion from this fact, the union says, was an error. The union sought to restore the relativities between all classifications in the Railway Employees' Award and in doing so it sought an adjustment to the relativities in all classifications. It did not seek to 'cherry pick' so that the percentage increases only applied to the higher classification levels. At no point during the proceedings did the union seek to limit the variation applied to the higher classification levels. [Did the learned Commissioner err in dismissing the applications?] ¶59 In each appeal the union accepts that the Commission's decision was discretionary. Thus, the appeals can only be allowed if an error of the type described in House v The King [1936] HCA 40; (1936) 55 CLR 499, 504 - 505 is identified. ¶60 In House v The King, Dixon, Evatt and McTiernan JJ at 504 - 505 set out the relevant principles as follows: The manner in which an appeal against an exercise of discretion should be determined is governed by established principles. It is not enough that the judges composing the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so. It may not appear how the primary judge has reached the result embodied in his order, but, if upon the facts it is unreasonable or plainly unjust, the appellate court may infer that in some way there has been a failure properly to exercise the discretion which the law reposes in the court of first instance. In such a case, although the nature of the error may not be discoverable, the exercise of the discretion is reviewed on the ground that a substantial wrong has in fact occurred. ¶61 An appeal against a discretionary decision cannot be allowed simply because the appellate body would not have made the same decision. The latitude may be considerable where the relevant considerations are confined only by subject matter and the object of the legislation which confers the discretion. However, because the decision-maker has some latitude, the correctness of the decision can only be challenged by showing error in the decision-making process: Coal & Allied Operations Pty Ltd v Australian Industrial Relations Commission [2000] HCA 47; (2000) 203 CLR 194 [19] - [21] (Gleeson CJ, Gaudron and Hayne JJ). It is well established that it is never enough that an appellate body, left to itself, would have arrived at a different conclusion, and when no error of law, mistake or fact is present, to arrive at a different conclusion which does not of itself justify reversal can be due to little else but a difference of view as to weight: Gronow v Gronow [1979] HCA 63; (1979) 144 CLR 513, 519 (Stephen J). ¶62 Whilst the learned Commissioner properly found that there is no barrier to the applications being dealt with under s 40 of the Act, his observation that the matters must be dealt with consistent with the Principles is not correct. The Principles are made each year by General Order by a Commission in Court Session as a State Wage Order pursuant to s 50 and s 50A of the Act. The making of a General Order requires more than the Commission act consistently with the Principles. The Commission is required to apply the Principles: Robe River Iron Associates v The Amalgamated Metal Workers and Shipwrights' Union of Western Australia (1993) 73 WAIG 1993, 1999 (Nicholson AP, Wallwork and Owen JJ agreeing). This error is not, however, material as principle 10 of the Principles expressly authorises any application to vary wages above or below the award minimum conditions. Although there is nothing in the Principles themselves that expressly provides for any pre-conditions that must be met or matters to be taken into account by the Commission when exercising the discretion to vary an award above or below the award safety, in successive State Wage Decisions the Commission in Court Session, when determining to award flat dollar increases to awards, have considered the potential effect of such a decision on award relativities and whether it is open to any party to an award to make an application to vary an award to restore pre-existing relativities. ¶63 When regard is had to the observations and findings made in each of the State Wage Decisions from 2006 to 2014, it is clear that the learned Commissioner did not err in finding that there has never been any recognition by the Commission of a direct relationship between equalising percentage adjustments in the state minimum wage and the adjustments of award rates of pay generally ([69], AB 76). To the contrary, it is patently clear from the observations and findings of the Commission in Court Session it has not considered the issue whether there should be established a nexus between cumulative minimum wage movements, expressed in percentage terms and the adjustment of award classifications in any award. In particular, the question whether there should be relativity between the rate of the minimum wage and any rates of pay in an award (other than the minimum wage itself) has not been considered. This point was properly conceded by senior counsel for the union at the hearing of the appeals. ¶64 Nor, with respect, is it open to imply in the reasoning of any of the State Wage Decisions since 2006 that in assessing any unfairness in compression of relativities in awards caused by flat dollar award increases it is open to rectify any compression by regard to the rate of the minimum wage. When percentage increases have been made to award rates on grounds to ameliorate compression in award classifications, the Australian Commission and the Commission in Court Session have not in their reasoning referred to or considered whether there should be established any relativity between the minimum wage and rates of pay of skill based classifications in awards. The issue that appears to have been considered in the wage decisions is whether internal relativities between classifications in skill based awards should be maintained and in that context they have considered whether in a particular wage decision a percentage increase should be awarded in that year to maintain existing relativities. ¶65 It is notable that in 1998 and 1999 the Australian Commission awarded lesser amounts of flat dollar increases to higher levels of classifications on grounds that this would lessen the effect of compression. This had the effect that those at higher classification levels received smaller increases than those at the lower levels. In 2001, the Australian Commission awarded higher amounts to higher levels of classification on grounds that it regarded such a measure as a means to avoid further compression. Why they adopted a different methodology in 2001 was not explained by the Australian Commission. ¶66 Consequently, I am not persuaded that the learned Commissioner erred in finding that there was no merit to allow the union's claims to increase the rates of pay in these awards by a cumulative percentage increase in the minimum wage. I am also not persuaded that he erred in finding that if the union's claims were allowed this would: (a) potentially allow other applications seeking the same relief; that is, have the effect of what is colloquially known as 'flow-on'; and (b) have the potential to undermine the integrity of the minimum wage adjustment process. ¶67 Whilst I do not necessarily agree that the applications if allowed by establishing this nexus would specifically undermine the needs of the low paid, I do agree that the relief sought by the union in these claims has the potential to undermine the integrity of the State Wage Decisions as the Commission in Court Session has in a number of successive decisions, when determining the amount of an increase to the minimum wage and to award rates of pay, taken into account and weighed a number of factors including the needs of the low paid, the capacity of employers to pay and compression of award rates of pay. ¶68 It is apparent from the reasoning given in the State Wage Decisions that when a flat dollar increase has been made to award rates of pay that the Commission in Court Session has determined on that occasion based on the evidence or the lack of evidence before it that the needs of the low paid and the need to minimise the effect of a particular increase on employers outweigh erosion of skill based career paths that could arise by the mere fact of compression of award rates. ¶69 The finding that if the union's claims were allowed, they could have the effect of opening the door to other applications is in my opinion a legitimate concern as the factual circumstances relied upon by the union raise no more than the mere fact of compression. The union's witnesses in their evidence merely expressed an opinion that the compression caused by flat-dollar increases had eroded skill levels. Yet, this evidence was merely supposition as since 2010, the award rates of pay have not applied as successive industrial agreements on an enterprise order have been in place. Thus, this evidence did not add to the information contained in exhibit A2. The real complaint of the union is that the flat-dollar increases have led to a widening in a gap over time between the rates of pay in industrial agreements and the award which could affect its ability to return to award pay and conditions if bargaining with the PTA for a replacement industrial agreement for either group of employees were to fail. ¶70 ''The union also relies upon the evidence revealed in exhibit R2 that the award rates of employees covered by the Rail Car Drivers Award and railway employees level 7 and above under the Railway Employees' Award is less than the rates of pay if cumulative rates of the consumer price index from 1 July 2006 until 1 July 2014 were applied. This it says is unfair which in turn it says raises a sufficient ground to claim that since 2006 there is more than the mere compression of classifications in each award. ¶71 The fact that award rates for all classifications of rail car drivers and for classification levels 8, 9 and 10 of the Railway Employees' Award is less than the cumulative consumer price index increases, was not put forward by the union to justify an increase in the award rates sought by it and they did not seek orders to increase those rates of pay to a level that is equal to the rates of pay that would apply if the consumer price index for the relevant period of time were applied. As exhibit R2 demonstrates, the rates of pay sought by the union not only exceed the amounts beyond consumer price index increases, but it also seeks to increase the rates of pay of all classifications of the Railway Employees' Award. ¶72 As the learned Commissioner pointed out, the elevation of award base rates to achieve bargaining leverage is not a proper basis to restore award relativities. The union does not cavil with this finding in these appeals. ¶73 In these circumstances, the union's claim must fall away as it is unable to demonstrate that the learned Commissioner erred in the exercise of his discretion to dismiss the applications. ¶74 For these reasons, I am of the opinion that ground 2.1 of each appeal fails. Ground 2.2 of each appeal also fails. The reasons given by the learned Commissioner in rejecting the union's claim were clearly adequate. ¶75 For the same reasons, I am also of the opinion that ground 2.3 of FBA 4 of 2015 and ground 2.4 of FBA 5 of 2015 must fail. The difficulty with the union's claims in each matter is that the claims went beyond a claim of restoration of relativities of internal classifications. The union made it plain in proceedings at first instance and on appeal that they did not consent to award relativities being adjusted on any other basis other than the establishment of a nexus of relativities between cumulative State Wage minimum movements. ¶76 It should be noted, however, that if the union wishes to put a different case to the Commission for restoration of internal relativities, or a variation of rates of pay based upon cumulative increases in the consumer price index, or on grounds of a work value claim or claims, it is open to the union to make fresh applications to do so. ¶77 I am satisfied that ground 2.3 of FBA 5 of 2015 is made out as it is clear that the union was not seeking to 'cherry pick' by only pursuing changes at the higher classification levels of the Railway Employees' Award. Whilst I am satisfied that this ground of appeal is made out, I am not satisfied that this factual finding led the learned Commissioner into appealable error. As counsel for the PTA points out in the PTA's written submissions, this finding is obiter. The learned Commissioner had already decided that there was no basis for the making of the variations sought. ¶78 For these reasons, I am of the opinion that orders should be made to dismiss each of the appeals. [BEECH CC] ¶79 I agree with Smith AP. [SCOTT ASC] ¶80 I have had the advantage of reading in draft form the reasons of her Honour, the Acting President. I agree with those reasons and have nothing further to add.