IN THE TASMANIAN INDUSTRIAL COMMISSION

Decision Appealed - See T1832

Industrial Relations Act 1984

On 19 September 1988 a Full Bench of this Commission upheld an appeal by the Hospital Employees Federation of Australia, Tasmania No 1 and No 2 Branches (HEF Nos 1 and 2) against part of an order issued by me on 5 May 19881.

The Full Bench concluded its decision as follows:

"The application, against which an appeal in part has been lodged, among other things sought an order from the Commission requiring casual, part-time employees working less than 20 hours, and intermittent employees to be paid for rostered shifts the ordinary time rate increased by 20%. Except for overtime the loaded rate was to be applied for all purposes, including the calculation of afternoon and night shift penalties, Saturday, Sunday and public holiday premiums.

However, in his decision the Commissioner expressed the view that the loadings should not be applied in the manner sought. Nevertheless, after acknowledging that some, but not all, hospitals were already applying the loading in the manner requested by the applicants, Commissioner King stated "whatever the situation may be, I believe there is substantial merit in the application. Therefore I will vary the award as requested."

We have, in the circumstances, decided to uphold the appeal and have formed an opinion that this matter should be referred back to Mr Commissioner King for such action as he sees fit. We have reached this conclusion having regard for the fact that there appears to be an inconsistency between the award he made and his reasons for decision. Having so decided we find it unnecessary to discuss any other grounds of appeal."

As a consequence of the above I relisted T721 and T999 of 1987 for further hearing on 26 October 1988. I also listed a new application lodged by the Tasmanian Confederation of Industries2 (TCI) dealing with the same subject matter as that dealt with on appeal by the Full Bench.

At the commencement of proceedings I agreed to a request from the HEF Nos 1 and 2 not to proceed further with their applications T721 and T999 of 1987. The effect of my consent to that request is that those files are closed.

The TCI application seeks the inclusion of the following, in appropriate clauses of Division A and Division C of the Hospitals Award (the Award).

"Casual employees shall have their wages for working shifts, which attract a penalty payment, calculated by adding the 20% loading to their hourly rate. Shift penalties are to be calculated on the base hourly rate, ie excluding 20%, the resultant amount to be added to the earlier calculation. In the case of the overtime penalty payments, the above method of calculation shall not be used. Overtime payments shall be calculated by adding the overtime penalty to the normal hourly rate payable to a full-time employee employed in the same classification."

The application also seeks the same method of calculation for part-time employees working less than 20 hours per week, covered by Divisions A and C and for intermittent employees working less than 20 hours per week, covered by Division D of the Award.

The above application wording is the same as that determined by me in the order appealed.

I do not propose to address the merit of the method of calculation of the 20% loading and shift penalties in this decision. I did so at some length in my decision of 5 May 1988 in T721 and T999 of 1987. I believe my reasoning in that decision is correct and nothing has been put to me since to change that view.

It therefore follows that I accept the merit submissions of the TCI going to the method of calculation.

However, for the benefit of the parties I highlight again the reasons for the above conclusion:

• I believe it illogical that a casual employee working 15 hours on afternoon, night or weekend shift, receives greater compensation for annual leave, sick leave and public holidays, than one who works equivalent time during ordinary hours (the fact that the Award prescribes that a casual employee while working overtime should not receive the 20% loading, clearly supports my view);

• To compound the 20% for a casual employee on afternoon, night or weekend shifts, puts him or her in an advantaged position compared to a full-time employee re annual leave, sick leave and public holiday entitlements;

• The interpretation decision relied on by HEF's 1 and 2 are of little value in merit considerations."

Having decided as above, I turn to the industrial relations considerations in this matter.

I accept the evidence produced by the HEF's 1 and 2, as demonstrating that all employers bound by the Award are now paying the 20% on a compounded basis to affected employees working afternoon, night, weekend or public holiday shifts.

I accept, as I did in T721 and T999 of 1987, that counterpart public sector hospital employees are being paid on the compounded basis.

It is also accepted that public interest considerations are raised by this application and the relevance of the "nexus" between public and private sector health employees must be considered.

From the foregoing it follows that I believe the determination of this matter depends on the weight one gives to the merit considerations on the one hand, versus the industrial and public interest implications on the other.

There are of course public interest considerations going to the question of salary and wages costs whether increased or reduced.

The granting of this claim would on the evidence now before me result in a reduction in rates paid to casual, part-time and intermittent employees working less than 20 hours, when they are engaged on afternoon, night, weekend or public holiday shifts.

In relation to the Wage Fixation Principles Mr Holden submitted that while there was nothing specifically mentioned, there were Full Bench decisions of the Federal Commission (Exhibit H3) which clearly put the onus of proof on the employer. Mr Holden maintained:

" ... that a particularly strong case is required to justify reducing an existing award condition ..."

There is no doubt that the TCI on behalf of employers is now opposed to paying a "penalty on a penalty" and is seeking a merit decision on the correct application of the relevant award provisions. I believe it has every right to do so. I am also satisfied that the correct application of the respective provisions, on merit, is as claimed. To that extent the TCI has satisfied the "onus of proof". In any case, I do not see this application as one seeking to reduce a clearly established award condition.

Having been convinced on the merit, I must now decide whether industrial and public interest ramifications are sufficient to cause me to reject the application.

The industrial considerations would cause me greater concern if the effect of granting the application was a reduction in "ordinary" rates paid. However, the diminution that would follow such a decision will only apply where substantial penalties or additions to "ordinary rates" are paid. The actual effect being a marginal reduction in the current penalties or additions.

As indicated earlier the public interest in this matter has two aspects. A reduction in rates paid to employees is an important consideration. Equally a reduction in costs to the private health system is very much a matter of public interest. I cannot find sufficient grounds on this aspect to warrant dismissing the application.

Much was said in these proceedings about the "nexus" between public and private sector health awards. I believe the importance or relevance of a nexus diminishes significantly where a party or parties no longer wish it to apply. There is no doubt that the TCI has on many occasions accepted or supported the existence of a nexus to sustain its position on a particular matter. However, in this instance it has chosen to reject any nexus considerations and has advanced arguments relying on merit. I believe in this case merit arguments, if sustained, must hold sway over other factors. In any case the Wage Fixation principles do not allow for comparative wage justice considerations.

It was also submitted during the proceedings that the 20% loading is not sufficient to compensate the casual or part-time employee for benefits received by the full-time employee. The question of whether the 20% loading is appropriate or not, is not before me in this matter, I therefore refrain from consideration of that aspect.

Having carefully considered all of the information and evidence put before me in this matter, I have decided to grant the application.

However, I am concerned that the effect of the decision is that some employees will suffer a reduction in rates currently paid. To lessen the impact of that reduction the date of operation of the Commission's order will be the first pay period commencing on or after 15 March 1989, the same operative date as the next National Wage adjustment.

I believe one further aspect requires some comment. Exhibit H7 details the current practice of employers in paying affected employees. That exhibit not only confirms that employers are currently paying the compounded rate, it also highlights that at least two do not want any change to that situation.

I acknowledge the TCI submission, that a majority decision of employers was responsible for it lodging this application and proceeding with it in the Commission. However, with an issue as important as the one raised, I would have preferred for obvious reasons that the employer view was unanimous.

The Commission's order is attached.

J G King
COMMISSIONER

1 T721 and T999 of 1987
2 T1654 of 1988