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T558

 

IN THE TASMANIAN INDUSTRIAL COMMISSION

Decision Appealed - See T632 - Appeal Dismissed

Industrial Relations Act 1984

 

T558 of 1986 IN THE MATTER OF an application by the Tasmanian Chamber of Industries to vary the Marine Boards Award

re: Service and Experience Payments
   
DEPUTY PRESIDENT A. ROBINSON Hobart, 10 December 1986
   

REASONS FOR DECISION
   
APPEARANCES:  
   
For the Tasmanian Chamber of Industries - Mr T.J. Abey
   
For the Australian Workers' Union - Mr D.P. Hanlon
   
DATE AND PLACE OF HEARING:  
   
24 November 1986 Hobart  
   
   

The application made by the Tasmanian Chamber of Industries is to vary the Marine Boards Award by adding a provision which would give "temporary construction workers" Service and Experience Payments (SIPS) upon commencement instead of after 6 months service.

Currently sub-clause 3(b) of Clause 8 of the award provides SIPS as follows:-

(b)    Scale of Payments $

On completion of 6 months service 43.60
On completion of 18 months service 47.40
On completion of 30 months service 51.30

The proposal advanced by employers is to insert a new sub-clause (c) as follows:-

"(c)   Temporary construction work employees

In circumstances whereby employees are specifically engaged on a temporary basis for construction projects, the payment applicable on completion of 6 months service shall be payable on commencement. Subsequent payments where applicable will remain unchanged."

Mr Abey argued that the award variation is justified and made the following points:-

  1. In reality SIPS exist as a payment because they are designed to match over award payments which are commonly paid in the private sector, i.e. they are a component in the wage structure, which goes to making up the going rate, rather than a recognition of service.

  2. A situation has developed in the marine boards area where construction projects undertaken have necessitated the employment of short term construction employees to carry out such work.

  3. The rates of pay applicable to such short term construction employees prescribed by the Marine Boards Award do not match going rates applicable in the construction industry during the first 6 months of employment.

  4. The present proposal would be an appropriate arrangement to rectify the shortfall in wage rates applicable under the Marine Boards Award compared to the National Building Trades Construction Award.

  5. The industrial reality has been that in two major construction projects completed by both the Port of Devonport Authority and the Port of Launceston Authority in recent times the first stage of SIPS has been paid on commencement as recognition of industrial reality and the going rates which are paid in the construction industry.

  6. It is unrealistic for the Marine Boards to have an award structure which is totally out of kilter with what is happening in the market place.

The proposal was supported by Mr. Hanlon who appeared for the Australian Workers Union. He submitted that -

  1. There has never been a practice of employing people for construction work and paying them differently than the average employee employed by the Marine Boards.

  2. The Marine Boards Award makes provision for casuals who are employed for up to 5 days to receive 20% loading, but provision is now being sought for people who are employed for a particular project, but who do not remain part of the permanent workforce.

  3. There is another project which is about to commence at Launceston with over 70 new or existing marine board employees to be involved. Such job is expected to run for 12 or 14 weeks, and all the application seeks to do is bring the award into line with practice, and ensure disputation does not occur between the two similar classifications working on the same project.

  4. The Launceston project will be carried out for a third party as distinct from the Marine Board, so that adds a complication.

Decision

The application to vary the award is refused for the following reasons:-

  1. The proposal does not conform with current Principles of Wage Fixation adopted by the Commission in matters T432 and T435 of 1986.

In particular Principle 9(c), Service Increments, provides:-

"(i) Existing service increments may be adjusted in the manner prescribed in (a)(ii) of the Principle"

(a)(ii) in turn provides:-

"Existing allowances which relate to work or conditions which have not changed may be adjusted from time to time to reflect the movements in wage rates as a result of national wage adjustments."

National wage increases have already been applied to SIPS in this award from time to time.

9(c)(ii) provides:-

"New service increments may only be allowed to compensate for changes in the work and/or conditions and will be determined in accordance with the relevant provisions of Principle 4."

No attempt was made by either party to justify the claim on the basis of compliance with the Principles because of changes in the work or conditions, or otherwise.

What is being sought is an increase in current award wage rates of $43.60 per week for employees with less than 6 months continuous service in the industry for which this award is established.

Such an increase in this award would be contrary to the intent of the Principles as spelt out very clearly in the preamble which says:-

"In considering whether wages and salaries or conditions should be awarded or changed for any reason either by consent or arbitration, the Commission will guard against any contrived arrangement which would circumvent these Principles.

The Principles have been formulated on the basis that the great bulk of wage and salary movements and improvements in conditions will emanate from national wage adjustments and consent arrangements in relation to superannuation. Increases outside national wage and superannuation arrangements - whether in the form of wages, allowances or conditions, whether they occur in the public sector or private sector, whether they be award or overaward - must constitute a very small addition to overall labour costs.

The Commission will guard against any Principle other than Principles 1 and 3 being applied in such a way as to become a vehicle for general improvement in wages and conditions."

Underlining mine

I do not regard an increase of $43.60 per week a very small addition to labour costs.

I also believe the potential for flow-on to be real.

  1. I disagree with the argument that service and experience payments are in reality designed to match over-award payments and thereby have no element of service and experience.

If this was true one wonders why clerks in Division 7 have been excluded from receiving SIPS in this award.

Why also would there be three rates instead of just one?

Presumably the over-award payment does not increase after 18 and 30 months service; yet it was argued that SIPS are designed simply to equate with over-award payments.

  1. The notion of putting "going rates" into awards is not a proper basis for setting levels of overall remuneration to be paid by all other employers covered by the same award.

Nor is a comparison of a paid rates award with a minimum rates award a legitimate exercise allowable within the principles.

Such a comparison is even more inappropriate when National Building Trades Construction Award rates are hourly rates and marine board employees, i.e. both "temporary" and "permanent", are weekly hire rates.

  1. Recent experience has shown that "temporary" employees engaged for one project undertaken by a marine board may be retained in employment for a further indefinite period and give rise to disputation as to how long is temporary and how permanent is permanent. (Ref. T456 of 1986, dispute between Port of Devonport Authority and various unions).
  1. The industry covered by the Marine Boards Award is separate and distinct from that of the building and construction industry and they should not be treated as being common industries.
  1. The fact that a certain project will be carried out in the near future by a marine authority for a "third party" (who was not represented) is not a persuasive factor for altering the award. To my mind, public interest criteria of Section 36 extends to protecting third parties against having unnecessary and unjustified costs imposed upon them by other, consenting parties.

 

A. Robinson
DEPUTY PRESIDENT
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