Industrial Relations Act 1988

Conciliation and Arbitration Act 1904 s.59 application for variation

The Vehicle Builders Employees Federation of Australia (C No. 30129 of 1989)

LANSDOWNE ENGINEERING AGREEMENT, 1982(1) (ODN C No. 00396 of 1982)

Allowance - sand/shot blasting allowance - work value principle - first awards and extensions to existing awards principle - sandblasting and shotblasting duties were not new work nor did they constitute a change in work value - current rate comprehends all aspects of the job - application refused.

By application dated 2 February 1989, The Vehicle Builders Employees Federation of Australia (VBEF) sought a variation to the Lansdowne Engineering Agreement, 1982 to provide for the introduction of a sand/shot blasting allowance in the following terms:

"An employee required to use a sand/shop blasting machine shall be paid an allowance of 55 cents per hour whilst so engaged, but if applied in a confined space $1.10 per hour extra."

As was explained by Mr Buck, Lansdowne Engineering, which is a division of A. Goninan and Company, is involved in the production of caterpillar dump truck bodies, railway carriages and other steel products.

The allowance sought is designed to compensate employees who perform shot or sandblasting operations on steel that has been affected by rust or

Some six employees will benefit by the grant of the allowance.

Mr Buck submitted that at present the employees receive a dirty work money allowance but both the union and the company are of the view that this allowance does not adequately compensate employees for the duties they perform.

In support of this argument, Mr Buck submitted that the employees wear a special air fed helmet and overalls. Exhibit B2 was tendered to demonstrate the type of equipment and lend support to the argument that the equipment is cumbersome and restricts movement. Further, Mr Buck submitted that when the high pressure gun was added to this equipment it could be seen that the allowance was justified.

Mr Buck further submitted that when this equipment is worn the operator is completely isolated from the rest of the workforce.

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Mr Buck then cited provisions in other federal awards where similar allowances were paid.

Mr Ashbridge, for the company, consented to the application and submitted that the allowance sought was within the range of allowances paid for similar work.

It was unclear from the submissions of the parties which wage fixing principle they were relying on to justify the new allowance. Mr Buck contended

". . . an allowance for work that has been undertaken that is required by the company that is not truly reflected in what is currently being undertaken."

In considering this application, it is appropriate to examine other decisions which bear upon the proper fixation of allowances.

Deputy President Isaac in The Australian Bank Officials' Association v. The Australia and New Zealand Banking Group and others(2) considered that there were three possible grounds for the granting of an allowance; an allowance for new work, an allowance for reflecting changes in work value, or an allowance for old work that was not covered by an award (i.e. award free work). The three grounds are encapsulated in the new allowance principle of the 12 August 1988 national wage case.(3) This principle stipulates that new allowances will only be granted if:

". . . changes in work have occurred or new work or conditions have arisen: where changes have occurred or new work and conditions have arisen, the question of a new allowance, if any, shall be determined in accordance with the relevant principle."(4)

The relevant principles are work value changes, first awards and extensions to existing awards.

The evidence of the parties established that the employees have been performing sandblasting and shotblasting since the inception of the industrial agreement in 1983. These duties were acknowledged by Mr Ashbridge to be an integral part of the manufacturing process. Hence, sandblasting and shotblasting were not new work and could not be covered by the first award principle. Similarly, the work value principle was not applicable as there had not occurred any subsequent change in the nature of the work, skill or responsibility required, since the fixation of rates by consent in 1983. The application could only be justified on the grounds that the sandblasting and shotblasting duties were award free. This argument must overcome an assumption which underpins the wage fixing principles, i.e., the current wage level comprehends all aspects of the job. This assumption was stated by Commissioner

Stanton in Queensland Alumina Limited v. The Australian Workers' Union where he stated:

"Unless the contrary appears, it is to be assumed that in any wage rate set, whether arbitrarily or by agreement, the conditions (i.e. physical)

under which the work is normally performed have been so considered and compensation allowed."(5)

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(2)Print D4273; (1977) 192 CAR 682 (3)Print H4000 (4)ibid., p.13 (5)Print C6883; (1976) 176 CAR 1254

His Honour Justice Alley in J. Ray McDelmott (Australia) Pty Ltd v. Amalgamated Metal Workers' and Shipwrights Union applied this principle to an application for an allowance reflecting a particular skill:

"The awarding of an allowance for the operational skill required in the performance of work by employees in classifications in respect of which there has been no change in the nature of the work skill and responsibility required since the last fixation of the rates would be an obvious frustration of the general intentions of the Commission as expressed in its national wage judgments."(6)

This principle has been reiterated in a recent decision of a Full Bench of this Commission in Foremen and Related Supervisory Catergories (Australian Public Service) Award 1985 and ADSTE (Australian Public Service General) Award 1985.(7) The Full Bench in its decision refused the application for a site allowance by stating that no change had occurred in the actual work or the conditions of work. The Bench referred to a statement made in the June 1986 national wage case:

"We reject the submission by ACPA that allowances should be created for aspects of the work not comprehended in the wage rate, without the need to establish changes in the nature of the work."(8)

The evidence of the parties established that the sandblasting and shotblasting duties were not new work nor did they constitute a change in work value.

The parties have not rebutted the assumption that the current rate comprehends all aspects of the job, hence the application must fail.

This is not to say however that it is not open to the parties to consider the totality of wage rates and internal relativities in the context of the structural efficiency principle.(9)

J. Buck for The Vehicle Builders Employees Federation of Australia.

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(6)Print D2727; (1977) 186 CAR 753 (7)Print H2807 (8)Print G3600; (1986) 301 CAR 611 (9)Print H4000, p.11