DECISION

Fair Work Act 2009
s.156 - 4 yearly review of modern awards

4 YEARLY REVIEW OF MODERN AWARDS—PHARMACY INDUSTRY AWARD
(AM2016/28)

Pharmacy Industry Award 2010 - substantive issues.

Introduction

[1] On 14 December 2018 we issued our decision 1 (December decision) concerning an application by the Association of Professional Engineers, Scientists and Managers, Australia (APESMA) for increases to the minimum rates of pay for pharmacists in the Pharmacy Industry Award 2010 (Pharmacy Award) on work value grounds. In that decision we stated three conclusions:

(1) The APESMA had demonstrated that there was an increase in work value associated with the introduction of Home Medicine Reviews (HMR) and Residential Medication Management Reviews (RMMR) that justified a discrete adjustment to award remuneration by means of the introduction of a new allowance. We invited further submissions about the form of this allowance (including whether it should be an annual or weekly allowance or an allowance payable each time a HMR or RMMR is performed) and its quantum 2 (first conclusion).

(2) We were satisfied that there had been an increase in the work value of pharmacists since 1998 in respect of the introduction of inoculations, the provisions of emergency contraception, the downscaling of medicines to pharmacy-only status, and a general increase in the level of responsibility and accountability. We invited parties to make further submissions as to how these findings should be reflected in an adjustment to remuneration, noting that not all pharmacists administer inoculations or dispense emergency contraception 3 (second conclusion).

(3) There was a lack of alignment in pay rates and relativities as between pharmacists (who require a four-year undergraduate degree) under the Pharmacy Award and those for classifications requiring equivalent qualifications under the Manufacturing and Associated Industries and Occupations Award 2010 (Manufacturing Award), as well as a lack of a consistent relationship with the Australian Qualifications Framework (AQF). We considered that this might potentially constitute a work value consideration relevant to the 4 yearly review of the Pharmacy Award. We invited further submissions as to this matter, and foreshadowed the possibility that this aspect of the review might need to be referred back to the President of the Commission for consideration as to the procedural course to be taken pursuant to s 582 of the Fair Work Act 2009 (FW Act) since it might have implications for other awards of the Commission 4 (third conclusion).

Further submissions

[2] Submissions were subsequently filed by the APESMA, the Pharmaceutical Society of Australia (PSA), the Pharmacy Guild of Australia (PGA), and Australian Business Industrial and the NSW Business Chamber (ABI).

APESMA

[3] The APESMA submitted that, arising from the third conclusion in our December decision, the starting rate for a pharmacy intern should be aligned with the rate for the C2(b) classification (which requires an advanced diploma plus additional training) under the Manufacturing Award, being $1132.40 per week. In the alternative, it submitted that the rate should be at least $952.60, which is equivalent to the minimum starting wage for a professional with a four year degree in the Health Professionals and Support Services Award 2010, the Nurses Award 2010, the Professional Employees Award 2010 and the Educational Services (Teachers) Award 2010. It proposed that the existing relativities for pharmacist classifications in the Pharmacy Award be maintained by reference to the adjusted entry level rate. This would rectify the inequity identified in the third conclusion, it was submitted, and would also be justified by the changes in work value identified in the second conclusion.

[4] In relation to the first conclusion, the APESMA proposed that an allowance should be established for pharmacists performing HMRs and RMMRs calculated at ten percent of the Experienced Pharmacist rate.

Pharmaceutical Society

[5] The PSA submitted that it is the “Australian Government-recognised peak national professional pharmacy organisation representing all of Australia’s 31,000 pharmacists working in all sectors and across all locations”. It did not appear in the primary proceedings concerning the APESMA’s claim, but nonetheless filed submissions concerning the adjustments to the Pharmacy Award which should flow from the conclusions reached arising from the proceedings. It submitted that:

the allowance for pharmacists performing HMRs and RMMRs should be quantified at 18 per cent of the minimum weekly wage for a Pharmacist; and

we should proceed to review and address the issue identified in the third conclusion.

[6] The PSA’s submissions did not address the second conclusion.

Pharmacy Guild

[7] In respect of the first conclusion, the PGA submitted that an allowance for work associated with HMRs and RMMRs should be payable on each occasion they are performed, and that it should be quantified on the basis of an approximate equation with one hour of the minimum rate for an Experienced Pharmacist (currently $29.79), and capped at approximately five hours per week ($148.95). On this approach, the allowance would be an additional 3.55 per cent of the standard rate on each occasion a HMR or RMMR was performed, to a maximum of 17.75 per cent per week when five or more HMRs and RMMRs were performed. It also proposed that clause 27 of the Pharmacy Award should be varied to add the new allowance in the list of matters which might be satisfied by the payment of an annualised salary.

[8] The PGA submitted that the second conclusion should be implemented by way of a general increase for all pharmacist classifications except for interns of five percent, to be implemented in two equal instalments on 1 July 2019 and 1 July 2020. In relation to the third conclusion, the PGA submitted that the adjustments to the rates it proposed would produce fair and relevant minimum wages and it was not necessary for the Commission to consider the relativity between pharmacists’ rates and those in the Manufacturing Award. In the alternative, it submitted that this matter should be referred back to the President for consideration as a common issue.

ABI

[9] ABI’s submissions only addressed the third conclusion. It submitted that the third conclusion raised issues of broad application to the operation of modern awards generally. The structure of classifications in the Manufacturing Award and the nexus with C10 had not been the subject of arbitral consideration and the Commission should be cautious in treating these as an unalterable or unquestionable reference point. It was, ABI submitted, reasonably open to question how comfortably the manufacturing classification structure and the C10 nexus sat with a contemporary work value assessment as contemplated by s 156(4) and also ss 134 and 135 of the FW Act. It was also highly questionable whether the AQF alone could serve as a satisfactory proxy for determining work value. Therefore, it was submitted, the matter should be referred for further consideration by the President as it was relevant to the jurisdiction as a whole and likely to affect all or a substantial number of modern awards.

Consideration

First conclusion – allowance for HMRs and RMMRs

[10] We are not persuaded by the PGA’s submissions that the allowance to be established for pharmacists who are qualified to perform and are required by their employer to perform HMRs and RMMRs should be paid on a “per occasion” basis, capped at a fixed number of occasions per week. As we found in paragraph [185] of the December decision, the performance of this work requires the acquisition of a new level of skill and responsibility by obtaining the higher qualification of Accredited Pharmacist. Further, as recorded in paragraphs [81] and [82] of the December decision, registration as an Accredited Pharmacist must be continually maintained. We do not consider that a “per occasion” allowance is an appropriate method to remunerate for work for which the employee must obtain and maintain accreditation. We propose to award an allowance quantified as a weekly amount.

[11] The additional work value involved in performing HMRs and RMMRs is significant. As stated, it requires a higher qualification, must be performed in “a different work environment involving the exercise of distinct personal interaction skills” and requires an “entirely new level of responsibility in terms of both medical outcomes and the claiming of CPA funding”. 5 We have had regard to the proposals for the quantification of this increase in work value proposed by the parties. We note that under the PGA’s proposal, the performance of five HMRs and/or RMMRs in a week would attract an additional amount of 17.75 per cent per week, and the performance of three would be an additional 10.65 per cent.

[12] We consider that an allowance calculated as ten per cent of the minimum rate for the Pharmacist classification ($106.40 on the rate as at 1 July 2019 resulting from the Annual Wage Review 2018-19 6) is appropriate. The allowance will be included in clause 19, Allowances, as subclause 19.1 (with the other subclauses to be re-numbered), and will be expressed in the following terms:

19.1 Home Medicine Reviews and Residential Medication Management Reviews

An employee classified as a Pharmacist, Experienced Pharmacist, Pharmacist in Charge or Pharmacist Manager who is required by the employer to perform Home Medicine Reviews or Residential Medication Management Reviews shall be paid an additional allowance of $106.40 per week.

[13] In order to allow employers to prepare for the introduction of this allowance, the above variation will take effect from the start of the first pay period commencing on or after 1 October 2019.

Second conclusion – wage increases for identified work value changes

[14] Notwithstanding our observation that not all pharmacists administer inoculations or dispense emergency contraception, all parties which dealt with the issue submitted that a general wage increase should be awarded in respect of the work value changes identified in the second conclusion. We are prepared to accept this as a practical approach while acknowledging that the degree to which pharmacists perform the duties and have the responsibilities identified in the second conclusion will vary. However the increase shall not apply to Pharmacy Interns since they do not administer vaccinations, provide emergency contraception or dispense medications. We consider that the PGA’s valuation of these work value changes as justifying a five per cent wage increase is appropriate. This increase, which will apply to the classifications of Pharmacist, Experienced Pharmacist, Pharmacist in Charge and Pharmacist Manager, will be introduced in two equal instalments of 2.5% from 1 July 2019 (in addition to the three percent increase arising from the Annual Wage Review 2018-19) and 2.5% from 1 October 2019 in order to mitigate their effect on businesses.

Third conclusion – relativities with the Manufacturing Award

[15] We are persuaded by ABI’s submission that the issue identified in the third conclusion should be referred to the President of the Commission for consideration as to the procedural course to be taken pursuant to s 582 of the FW Act. As we identified in the December decision, the issue has ramifications for other awards which contain classifications applying to employees who are required to hold undergraduate qualifications including, but not limited to, the Professional Employees Award 2010. As such, a broader review of the issue across a number of awards may be called for. We also note that a similar issue has been raised in connection with proceedings currently on foot concerning the Educational Services (Teachers) Award 2010. 7

VICE PRESIDENT

Printed by authority of the Commonwealth Government Printer

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 1   [2018] FWCFB 7621

 2   Ibid at [185]-[187]

 3   Ibid at [188]-[189]

 4   Ibid at [194]-[198]

 5   Ibid at [185]

 6   [2019] FWCFB 3500

 7   AM2018/9