I believe it applies multiplicatively and before the inclusion of any additional skill damage.
Suppose you're using Galrath Slash with a 15^50 sword.
1) The initial damage roll will be somewhere in the range of 15-22. It is then modified by 15% to 17.25-25.3, and further increased by your weapon mastery.
2) I'm omitting the target's armor and level from this situation, because it's irrelevant to your question, but this is where it would be checked.
3) Lastly, the +damage provided by the skill is applied.