The Fair Work Commission must be one of the most attractive sinecures in the world. There is a President, two vice presidents, 21 deputy presidents, 18 commissioners plus various expert panel members. The President is paid as the Chief Justice of the Federal Court.
For others who have not previously been a judge, the current Remuneration Tribunal salary is $581,940 for vice presidents, $471,090 for deputy presidents and $387,960 for commissioners. All have a tier 1 travel allowance, allowing the maximum travel allowance and first class travel overseas (whenever that might return).
The presidential members (ie: other than commissioners) are eligible for the Judges Pension scheme, which has no contributions and allows the member with 10 years service to retire with 60 per cent of his or her current salary, indexed for life to the equivalent salary (ie: by wages not by inflation). In other words, a retiring deputy president has an indexed pension of 60% of $471,090 increasing in line with Remuneration Tribunal determinations.
Fair Work Commission members are appointed to the age of 65 and can only be dismissed by a vote of both houses of Parliament – effectively they cannot be sacked except for criminal activities.
Recently there have been a number of appointments, particularly of young women. Amanda Mansini was appointed a deputy president effective 4 February 2019 at the age of 35. Amber Millhouse, another deputy president, was appointed on 24 September 2017 at the age of 36. They thus have a term of almost 30 years. There are others like Sarah McKinnon appointed in 2017 at the age of 40, Lyndall Dean in 2016 at the age of 44, and Tony Saunders in 2018 at the age of 45.
It’s one thing to create statutory organisations with relatively long appointments for independence, but 30 year terms are ridiculous. It would be better to allow for a single 10 year term, without reappointment like the Auditor-General.
So let’s do a calculation of the present value to Mansini of her appointment. According to the ABS life tables, her life expectancy in 2019 was 50.55 years, which would take her to almost 86 years. I will assume a real wage growth of 2 per cent per annum, which is relatively conservative (low) for statutory appointments over the past 20 years. I will also assume that this appointee, taking the job at age 35, serves until 65 and then retires with the Judges Pension Scheme with retirement income of 60 per cent until death. This calculation underestimates the present value as it does not take account of a partner who would continue (under the Judges Pension Scheme) to collect 62.5 per cent of the deceased spouse’s pension and there is an additional allowance for children. Similarly, it does not account for the opportunities and prestige of the office.
Again, the calculation is for a 35 year old woman accepting an appointment as deputy president to the Fair Work Commission in 2019.
The present value for this person is $32.5 million.
Not a bad sinecure, and certainly not one of the most challenging jobs in the world.