Inclusive Employment 2012–2022:
A Vision for Supported Employment
Future wage setting arrangements:
a discussion guide
July 2013
a strong and fair society for all Australians
Contents
What is this discussion about?
3
The Vision: our goals for supported employment
4
Early progress
4
How should wages be determined into the future?
5
Objectives for wage setting
5
Principles for any model
5
Characteristics of a robust model
6
Wage setting tools: alternative options
7
How do we move to a new model?
8
Next steps
9
Further information
10
Appendix A: Background information on current wage setting arrangements
11
The wage assessment tools
11
The Business Services Wage Assessment Tool: a short history
11
Implications of the recent Federal Court findings
12
What is this discussion about?
The Australian Government funds Australian Disability Enterprises to employ support workers with disability
who might not otherwise obtain or maintain a job in the open labour market. There are 194 not for profit
organisations operating these enterprises, which employ about 20,000 people — most of whom have an
intellectual disability.
A recent decision by the Federal Court found that one of the tools used in determining wages in supported
employment — the Business Services Wages Assessment Tool (BSWAT) — was discriminatory under the
Disability Discrimination Act 1992 in relation to the circumstances of two workers. Depending on the
circumstances of each case, the decision may have implications for other workers and employers in the
sector.
Following this decision, the Government wants to make sure that future wage setting mechanisms respect
the decision of the court and improve employment outcomes for people with disability, while ensuring the
supported employment sector is viable into the future.
The Government also wants to make sure that future wage setting arrangements align with our ten year
vision for supported employment — Inclusive Employment 2012–2022 (the Vision). The Vision was
developed after extensive consultation and is a shared framework between the Government, employees
and employers for decisions about the future of supported employment.
The Department of Families, Housing, Community Services and Indigenous Affairs will conduct face-to-face
consultation sessions in July and August 2013 with supported employees, their carers and families,
employment providers and peak organisations across the country.
These consultations will seek people’s views about how future wage setting arrangements should be
determined and how we should move to a new model so that Australian Disability Enterprises and workers
are supported in the transition period.
Further background about current wage-setting arrangements, BSWAT and the Federal Court’s decision is
in Appendix A.
3
The Vision: our goals for supported employment
By 2022, Australia will have a supported employment system that provides economic and
social participation benefits for people with disability, and for Australia.
People with disability will have access to a supported employment system that fully supports and enables
their participation and inclusion in Australian society by providing services to obtain and retain quality
employment.
The 10 year Vision is a major change for supported employment in Australia. These changes will mean by
2022:
 People with disability in supported employment will have higher wages and higher average hours of
work.
 Supported employment organisations will have the capacity to pay higher wages.
 There will be increased community awareness and inclusion of people with disability.
 There will be higher levels of employment of people with disability in both the public and the private
sectors.
 There will still be specialised organisations that have their origins in Australian Disability Enterprises,
but they will have adapted to be more responsive to the demands of their employees with disability.
The Vision recognises that delivering these changes will take time, and that transition strategies are
required.
Early progress
In 2012–13, the Government provided almost $8 million in funding for projects that make an early start on
transitioning to the Government’s Vision for supported employment.
This funding has delivered projects including:
 a Social Firm Transition Fund to assist businesses to work with expert mentors, develop plans and start
to move towards becoming a social enterprise or social firm providing a more viable and sustainable
business model;
 a new website called ‘Disability Ideas Informing Practice’ to encourage discussion and sharing of
success stories from the sector on best practice in supported employment (to be launched in October
2013); and
 help to access independent case management and retirement planning for up to 2,500 older workers
who may be wanting to learn about or move to retirement.
Where do you think early progress has been made?
How should we measure progress towards realising the Vision over the 10 year transition
period? Do you think we should set interim goals?
What areas need to be prioritised to meet the Vision’s goals?
4
How should wages be determined into the future?
Objectives for wage setting
How employees’ wages are determined is an important part of delivering on the Vision’s goals. For people
with disability to achieve higher wage outcomes over time, wage setting tools must be fair and reasonably
assess a worker’s contribution.
Supported employment organisations also need to have the capacity to pay higher wages while making
sure that workers’ jobs are secure. This means they need to operate viable and sustainable businesses so
they can continue to provide employment for people with disability.
The Government wants to make sure that wage setting delivers fair and non-discriminatory outcomes for
workers, while making sure that Australian Disability Enterprises remain viable into the future.
Do you agree with the Government’s objectives for wage setting?
Are there other objectives the Government should consider?
Principles for any model
Principles for a new wage determination process for people in supported employment might include:
 fairness — delivers fair and equitable wage outcomes that represent the proportion of the full work task
and industry standard that the employee achieves
 non-discriminatory — meets the requirements of the Disability Discrimination Act 1992
 transparency — the wage assessment process is clear, well documented, understandable to all
involved and open to scrutiny
 reliability and validity — the process is founded on well-researched wage determination methods that
provide reliable and consistent results so that employees doing the same work to the same standard
receive the same wage outcome no matter where they are working in Australia
 objectivity — measures and criteria used in wage assessment are not open to bias or inconsistent
interpretation.
Do you think that these principles are the right ones to guide decisions about future wage
setting tools?
What other principles do you consider to be important?
5
Characteristics of a robust model
The new wage assessment process should also:
 comply with all relevant legislation, for example the Fair Work Act 2009, the Disability Services Act 1986
and human rights and equal opportunity legislation, and our obligations under the United Nations
Convention on the Rights of Persons with Disabilities;
 link to national industry standards and qualifications;
 put in place individual workplace training and career development plans so that the employee has a skill
development pathway to higher wage grades;
 ensure that the minimum wages and conditions specified in law or industrial agreements for that work
are consistently applied;
 be straightforward to apply and administer
Do you think that these characteristics are the right ones to guide decisions about future
wage setting tools?
What other characteristics do you consider to be important?
6
Wage setting tools: alternative options
Given the Federal Court’s decision that BSWAT indirectly discriminated against workers, Australian
Disability Enterprises and the Australian Government will need to consider new approaches.
The table below outlines some of the options that have been suggested, with some of the possible
advantages and disadvantages of each model. The Department has not formed a view on any of these
approaches, and is seeking your views.
Option
Advantages
Disadvantages
Change the legislation to allow
BSWAT to be used in the future
 The current process would
continue.
 Does not address the court’s
concerns about BSWAT.
 Does not improve wage outcomes
in line with the Vision.
Change the BSWAT so that the
competency component is not
discriminatory.
 BSWAT is already widely used
and so the changes would be
easier to roll out.
 It could take a long time to work
out a way of assessing
competency that is not
discriminatory.
Modify one of the other 29 tools
 The existing tool would be a
starting base so the development
and implementation of the tool
would be quicker than starting
from scratch.
 The other tools have not been
tested through the court system.
 Puts supported employment on
the same standard of wage setting
as mainstream employment.
 Does not reflect the pared back
nature of some jobs in supported
employment that may not exist in a
mainstream setting meaning it
could result in extra wages being
paid to people with disability which
may impact on ADE viability.
NB: Most of these tools also
measure competency.
Make more use of the Supported
Wage System (SWS), (a tool that is
already used in mainstream
employment).
NB: the SWS does not measure
competency.
 SWS is already accepted by the
Australian community as a fair and
transparent way of working out
wages for people with disability.
 It could take a long time to work
out a way of assessing
competency that is not
discriminatory.
 Would take time to implement as
would require more assessors to
be trained etc.
Design a new tool that measures
competency in a way that better
reflects the employee’s actual job.
 The new tool could reflect the
nature of work in supported
employment to ensure that the
wages paid to people with
disability are fair and reflect the
value they provide to their
employer.
 It could take a long time to develop
and implement such a tool.
What do you think of these alternate approaches? How do they measure up against the
desired outcomes and principles for wage setting?
Do you have any other suggestions?
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How do we move to a new model?
Virtually all Australian Disability Enterprises are not-for-profit organisations that do not have large cash
reserves or other income to cope with immediate increases to wages.
We need to do what we can to make sure that the transition process is as smooth as possible and that a
changing industrial landscape doesn’t lead to people losing their jobs. Many supported employees told us
when the Government was developing the vision for inclusive employment that they like their current
workplace — while they might like higher wages and more work choices, they want to be able to continue
working where they are.
The Australian Human Rights Commission can grant temporary exemptions from some parts of the
Disability Discrimination Act 1992. Exemptions can only be granted for purposes that further the objects of
the Act. They may be subject to conditions that are set by the Commission, and are limited to a term of not
more than five years.
The Department believes an exemption of up to three years would give it enough time to consult on,
develop and implement appropriate wage-setting arrangements — including an alternative assessment
method — and allow time for Australian Disability Enterprises to develop strategies to help them to remain
viable into the future. It will also take time to transition to any new wage setting arrangements including the
complexity of developing a new tool, train new assessors, and conducting new assessments.
The Department is working quickly to lodge an application for exemption under section 55 of the Disability
Discrimination Act for the continued use of the Business Services Wage Assessment Tool until a new
wage-setting approach is in place. If we are ready to move to a new wage setting approach earlier than in 3
years we will.
The exemption period will also enable the Australian Government to align the new approach to wage setting
with the renegotiation of funding agreements.
When an exemption application is lodged the Human Rights Commission will invite stakeholders to
comment on it by publishing it on their website. There will be a 12 week period for comment. The Human
Rights Commission will consider if the exemption is necessary, if the application is consistent with the
objects of the Disability Discrimination Act, if it is appropriate to grant the exemption, and whether particular
terms and conditions should be imposed.
Do you think a temporary exemption would be useful to help ADEs and workers transition
to a new model?
What support will Australian Disability Enterprises need over the transition period so they
are able to pay wages under a new model when the exemption expires?
What support will workers need over the transition period?
8
Next steps
The Government is interested in hearing your views and suggestions on possible new approaches to wage
setting.
The Government understands the significance and urgency of this matter for both supported employment
providers and their employees, and will continue to work to resolve this matter as quickly as possible.
After the consultation sessions in July and August 2013, FaHCSIA will prepare a report for the Government
to consider when it is deciding on next steps.
9
Further information
On the vision: Inclusive Employment 2012–2022: A vision for supported employment
On the exemption process: visit http://www.humanrights.gov.au/our-work/legal/
exemptions/exemptions-under-disability-discrimination-act
For more information on progress to date in realising the vision and other enquiries related to supported
employment please email bswat@fahcsia.gov.au
10
Appendix A: Background information on current wage
setting arrangements
The wage assessment tools
Australian Disability Enterprises operate within federal and state industrial relations regulatory frameworks.
Under the 2002 amendments to the Disability Services Act 1986, they must meet disability services
standards. These standards include the requirement to pay award-based wages to supported employees
using a transparent wage assessment tool.
This requirement is reflected in the Supported Employment Services Award 2010, which allows the wages
of supported employees to be determined through one of 30 wage assessment tools. These tools measure
the employee’s productivity and/or competency. They have been independently assessed as valid and
reliable in their own right under the criteria set out in A Guide to Good Practice Wage Determination.
Each business chooses its own tool to assess the wages of its supported employees.
Most Australian Disability Enterprises use one of four wage assessment tools: the Business Services Wage
Assessment Tool, SkillsMaster, Supported Wage System, or Greenacres. These are the only wage
assessment tools that can be applied to any general industry. Of the remaining 26 tools, a large proportion
are used by only one organisation.
The wage assessment tools vary greatly in their approaches: some use independent assessors, while
others allow for the Australian Disability Enterprise to conduct the assessment. Most cover the assessment
of specific tasks and occupations in a particular industry, such as gardening, paper manufacturing, timber,
assembly, packing, clothing or laundry.
The Business Services Wage Assessment Tool: a short history
Until the mid-1990s, Australian Disability Enterprises were mostly excluded from the industrial relations
legislation that applied to other employers. Much debate took place around this time about how Australian
Disability Enterprises might fit into the industrial relations landscape — in particular, about the best way to
calculate wages for people with disability.
At the same time, the Supported Wage System was being introduced into the open labour market. This tool
simply compared the productivity of a person with disability with that of another employee without disability
who was doing the same job to determine a wage. Many Australian Disability Enterprises thought, however,
that the Supported Wage System would not be an effective wage assessment tool in their situation because
they had simplified jobs to such a degree that comparable roles would not exist in a mainstream
employment environment.
As a result, the Business Services Wage Assessment Tool was developed in consultation with a wide range
of stakeholders and was adopted by more than 50 per cent of Australian Disability Enterprises. It measures
a person with disability’s competency by asking questions of the employee relating to four core
competencies and up to four additional industry-specific competencies.
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Implications of the recent Federal Court findings
In December 2012, the full Federal Court found that the Business Services Wage Assessment Tool
indirectly discriminated Mr Nojin & Mr Prior on account of their intellectual disability.
In particular, the Court found that the competency component of this tool was a requirement or condition
that people with intellectual disability could not comply with. In this case the Court found that it was
unreasonable that the scores in the BSWAT assessments did not reflect the actual capacity of the
employees to undertake their work. The Court held that the requirement was not reasonable in the specific
circumstances of the cases.
The full implications of the Federal Court’s finding are not yet clear and FaHCSIA has sought urgent
technical and legal advice on the implications. We will provide more information to all interested parties as it
becomes available.
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