Department of Human Services v Australian Nursing Federation (SA Branch) No. Scciv-02-664

DEPARTMENT OF HUMAN SERVICES v AUSTRALIAN NURSING FEDERATION (SA BRANCH)
[2002] SASC 345
Full Court: Doyle CJ, Perry and Debelle JJ

DOYLE CJ I agree with the order proposed by Debelle J. I agree also with his reasons for the making of that order. There is nothing that I wish to add to those reasons.
PERRY J I agree with the order proposed by Debelle J and with his reasons.
DEBELLE J This is an appeal by leave from a decision of the Full Court of the Industrial Relations Court.
On 21 June 2000, the respondent instituted a claim in the Industrial Court on behalf of members of the South Australian branch of the Nurses Federation who are employed as shift workers or seven day week workers by incorporated hospitals or incorporated health centres. For convenience, I will refer to these workers as “shift workers”. The shift workers alleged that for the six years preceding 21 June 2000 they had not been paid the full amount of the loading to which they are entitled when taking annual leave.
The questions for decision in that claim turned on the meaning of provisions relating to the annual leave loading contained in the Nurses (South Australian Public Sector) Award 1991 (“the Nurses Award”) and the Nurses (SA) Mental Health Service Award 1992 (“the Mental Health Award”). Although both Awards are Federal Awards made by the Australian Industrial Relations Commission, the Industrial Court is at liberty to interpret them for the purpose of determining the claim.
Some of the shift workers are employed under the Nurses Award and others under the Mental Health Award. There is no material difference between the terms of each Award. It will be convenient, therefore, to refer only to the Nurses Award.
The provisions concerning annual leave are contained in clause 28 of the Nurses Award. The Award provides for an entitlement to annual leave. In the case of shift workers, that entitlement is for six weeks annual leave and for other employees it is four weeks annual leave: clause 28(a)(i). While on leave, each employee is to be paid the amount of wages he or she would have received had he or she been working in that time: clause 28(b)(i). In addition, each employee is entitled to be paid a loading over and above the pay which would have been received had the employee not been on leave: clause 28(d). It is the terms of clause 28(d) and, in particular, sub-clause (i) and (ii)(2) which give rise to the present dispute. Clause 28(d) provides:
“Additional Leave Loading
(d)(i) In addition to the payments prescribed by subclauses (a), (b), (c), of this clause each employee, during a period of annual leave or in respect of pro rata leave shall be paid a loading computed upon the normal rate of pay attaching to the classification concerned at the time when the employee commences such leave to a maximum as prescribed by the Public Service (Recreation Leave Loading) Award of the Industrial Commission of South Australia from time to time. Provided, however, that no full-time employee shall receive a loading in excess of the maximum as prescribed in respect of any one full entitlement of annual leave. In the case of part-time employees no such employee shall receive a loading in excess of the same proportion of the maximum that the hours of duty of the part-time position bears to the hours of duty of a corresponding full-time position.
(ii)The loading shall be applied as follows:
(1)If employed other than as a shift worker or a seven day week worker a loading of 17.5 per cent calculated on the rate of pay as set out in paragraph (b)(i), and subparagraphs (1), (2), (3) and (4) where applicable.
(2)If employed as a shift worker or a seven day week worker (i.e. an employee who is working rotating shifts on seven days a week or who is rostered to work regularly on active duties on Saturday, Sunday and public holidays), either a loading of twenty per cent calculated on the rate of pay as set out in paragraph (b)(i) and subparagraphs (1), (2), (3) and (4) where applicable or the weekend and shift penalties she or he would have received had she or he not been on leave during the relevant period, whichever is the greater.
(3)An employee who is employed for part of a year as a shift worker or as a seven day week worker shall be paid a loading as prescribed by subparagraph (d)(ii)(2) on a pro rata basis in respect of completed months worked as a shift worker or a seven day week worker and for the balance she or he shall be paid a loading as prescribed by subparagraph (d)(ii)(1) hereof.
(4)Payment should be made in amounts proportionate to the actual period of annual leave taken (calculated to the nearest cent). This procedure also applies to non Public Holidays during the Christmas-New Year period where applicable. However, subject to the provisions of subparagraph (5) hereof, payment of the loading on pro rata leave due to an employee who terminates or who has her or his service terminated other than by retirement should be made in amount proportionate to the period of leave calculated in accordance with the provisions of subclause (c)(iii) hereof.
(5)Unless the South Australian Health Commission otherwise directs in writing, an employee must repay the annual leave loading granted in respect of that period of service which has not been performed by the employee at the time she or he leaves her or his employment.
(6)For employees who remain in the employ of the employer and have been paid a leave loading and whose rate of pay is subsequently increased with retrospective date of operation, an appropriate adjustment should be made where she or he qualifies for additional payment.”
It seems that the terms of clause 28 have remained unaltered since 1991.
It will have been noticed that clause 28(d)(i) stipulates that the loading is payable up to a maximum amount. However, instead of fixing that maximum amount, the Award stipulates that it will be prescribed by the Public Service (Recreation Leave Loading) Award of the Industrial Commission of South Australia from time to time (“the Leave Loading Award”).
Stripped to essentials, the shift workers contend that the manner in which the leave loading is to be calculated is by reference to the concluding words of clause 28(d)(ii)(2), that is to say, they should have received an amount equal to the weekend or shift penalties which would have been received had the shift worker not been on leave. For its part, the appellant contends that the Leave Loading Award has at all times prescribed a maximum to which the provisions of clause 28(d)(ii)(2) are subject so that the workers are entitled to receive penalties up to that prescribed maximum.
The difference between the parties can be illustrated by reference to the position prevailing in 2000. Shift workers in 2000 were paid an annual leave loading of $473.75, the amount prescribed by the Leave Loading Award. At that time, the amount calculated in accordance with clause 28(d)(ii)(2) could have been as high as $1,002.30 for some workers. In broad terms, shift workers say they are entitled to a loading substantially in excess of what they have been paid. They seek to recover the difference. The appellant contends that the sum of $473.75 is a ceiling which applied also to those in receipt of penalties so that shift workers have been paid the whole of their proper entitlements.
In the Industrial Relations Court the parties agreed certain facts, the effect of which has already been summarised, and sought the determination of the following questions of law:
“(1)Whether the entitlement of the group of members to the leave loading payable up to 30 June 1998 is limited to a maximum of $462.50 in respect of any one full entitlement of annual leave where the sum equivalent to the allowances and penalties payable to each particular employee had the employee not been on leave during the relevant period exceeded the said maximum.
(2)Whether the entitlement of the group of members to the leave loading payable from 1 July 1998 to date is limited to a maximum of $473.75 in respect of any one full entitlement of annual leave where the sum equivalent to the allowances and penalties payable to each particular employee had the employee not been on leave during the relevant period exceeded the said maximum.
(3)If the answer to either or both of questions [(1)] or [(2)] is no, whether the group of members are entitled in fact and law to a sum due to them from the respondents within the meaning of Section 14 of the Industrial and Employee Relations Act 1994.”
It was later agreed to postpone the determination of the third question pending the resolution of the other two. A judge of the Industrial Relations Court answered both questions, No. From that decision, the appellant appealed to the Full Court of the Industrial Relations Court which upheld the decision of the judge below. The appellant now appeals by leave to this Court.
Before dealing with the issues, it is convenient to examine the relevant terms of the Leave Loading Award which has varied from time to time. The Leave Loading Award in force in 1991 had been made on 11 March 1975 on an application made on 3 April 1974. It was numbered No. 49 of 1974. Clause 7 of the 1974 award prescribed the leave loading. The relevant provisions stated:
“(a)   During a period of recreation leave or in respect of pro rata leave an officer shall be paid a loading computed upon the normal salary attaching to the office concerned at the time when the officer commences such leave (to a maximum of $150) in accordance with this clause provided, however, that no officer shall receive a loading in excess of $150 in respect of any one full entitlement of annual leave.
…
(b)     The loading shall be applied as follows:—
(i)     if employed other than as a seven day week worker, a loading of 17½ per cent calculated on the salary as set out in subclause (a) hereof.
(ii) if employed as a seven day week worker (i.e. an officer who is working rotating shifts on seven days a week, or who is rostered to work regularly on active duties on Saturdays, Sundays and Public Holidays)
either
a loading of 20 per cent calculated on the salary as set out in subclause (a) hereof,
or
the allowances and penalties payable had the officer not been on leave during the relevant period
whichever is the greater.
For the purposes of this subclause, allowances and penalties shall include shift penalties, weekend penalties, locality allowances, fire-fighting allowances, annual allowances in lieu of overtime, allowances for non-observance of a 40 hour week and uniform allowances.
(iii) an officer who is employed for part of a year as a seven day week worker shall be paid a loading as prescribed in (b) (ii) hereof on a pro rata basis in respect of completed months worked as a seven day week worker and for the balance he shall be paid a loading as prescribed in (b) (i) hereof.”
It is apparent from the terms of clause 7 that sub-clause (b) prescribed the method by which the loading was to be calculated for shift workers, for those who were not shift workers, and for those who worked as shift workers for part of the year and, for the rest of the year, did not. In the case of shift workers, there were two alternative means of calculation which were clearly intended to enable the worker to receive all allowances and penalties which would have been paid had the worker not been on leave. That was consistent with the spirit of the decision in the Annual Leave Case (1974) 41 SAIR 300. It is equally plain that sub-clause (a) prescribed a maximum to apply to all those workers. In short, sub-clause (a) placed a ceiling on the amount to be paid as the annual leave loading. An examination of the reasons of the Industrial Commission when making the award confirms that conclusion. The relevant decision is the Public Service (Recreation Leave Loading) Award Case (1975) 42 SAIR 195. At 205 – 206, Olsson J said that there should be a “maximum absolute amount” which should be received as the loading and “the fairest procedure is to prescribe a maximum amount in the form of an absolute figure”, a figure which could be increased from time to time by variation of the award. That is what has occurred. The prescribed maximum was increased from time to time by variation of the award.
The structure and effect of the Award at least as it related to shift workers remained substantially the same subject only to an increase in the prescribed maximum. In 1990 clause 7 was in these terms:
“(a)During a period of recreation leave or in respect of pro rata leave an employee shall be paid a loading computed upon the normal salary attaching to the office concerned at the time when the employee commences such leave (to a maximum of $425.40) in accordance with this clause provided, however that no employee shall receive a loading in excess of $425.40 in respect of any one full entitlement of annual leave.
…
(b)     The loading shall be applied as follows:
(i)     if employed other than as a shift worker or as a seven-day week worker,
either
a loading of 17 ½ per cent calculated on the salary as set out in sub-clause (a) hereof,
or
the allowances and penalties payable had the employee not been on leave during the relevant period,
whichever is the greater.
(ii)    if employed as a shift worker or a seven-day week worker (i.e. an employee who is working rotating shifts on seven days a week, or who is rostered to work regularly on active duties on Saturdays, Sundays and public holidays),
either
a loading of 20 per cent calculated on the salary as set out in sub-clause (a) hereof,
or
the allowances and penalties payable had the employee not been on leave during the relevant period,
whichever is the greater.
(iii)   an employee who is employed for part of a year as a shift worker or a seven-day week worker shall be paid a loading as prescribed in (b)(ii) hereof on a pro rata basis in respect of completed months worked as a shift worker or a seven-day week worker and for the balance he shall be paid a loading as prescribed in (b)(i) hereof.
(c)For the purposes of placita (i) and (ii) of subclause (b), allowances and penalties shall (as appropriate) include shift penalties, weekend penalties, fire-fighting allowances, annual allowances in lieu of overtime, allowances for non-observance of a 40-hour week and uniform allowances.”
On 4 September 1997 the Leave Loading Award was varied to increase the ceiling to $462.50, the variation to operate retrospectively from 1 July 1997. By then, the award had been cast in different terms but its structure was the same and a ceiling was prescribed. It provided:
“1.5.1During a period of recreation leave or pro rata leave an employee is to be paid a loading computed upon the normal salary attaching to the office concerned at the time the employee commences leave. However, no employee is to receive a loading in excess of $462.50 in respect of any one full entitlement of annual leave.
1.5.2 The loading is to be applied as follows:
1.5.2.1if employed other than as a shift worker or as a seven-day week worker,
either
a loading of 17 ½ per cent of the salary
or
the allowances and penalties payable had the employee not been on leave during the relevant period,
whichever is the greater.
1.5.2.2if employed as a shift worker or a seven-day week worker (i.e. an employee who is working rotating shifts on seven days a week, or who is rostered to work regularly on active duties on Saturdays, Sundays and public holidays),
either
a loading of 20 per cent of salary
or
the allowances and penalties payable had the employee not been on leave during the relevant period,
whichever is the greater.
1.5.2.3an employee who is employed for part of a year as a shift worker or a seven day week worker is to be paid a loading as prescribed in 1.5.2.2 on a pro rata basis for completed months worked as a shift worker or a seven-day week worker and for the balance be paid a loading as prescribed in 1.5.2.1.”
It is, therefore, readily apparent that from 1974 to 1997 there had been provisions relating to the leave loading payable to either shift workers or other workers and providing alternative means of calculation of the loading for shift workers. However, at all times, the loading had been subject to a ceiling.
In September 1998 the Leave Loading Award was amended again, the amendment to operate retrospectively from 1 July 1998. The amended clause 1.5 was in these terms:
“1.5.1During a period of recreation leave or pro rata leave an employee is to be paid a loading computed upon the normal salary attaching to the office concerned at the time the employee commences leave.
1.5.2 The loading is to be applied as follows:
1.5.2.1if employed other than a shift worker or as a seven-day week worker,
either
a loading of 17 ½ per cent of the salary up to a maximum of $473.75 for any one full entitlement of annual leave,
or
the allowances and penalties payable had the employee not been on leave during the relevant period,
whichever is the greater.
1.5.2.2if employed as a shift worker or a seven-day week worker (i.e. an employee who is working rotating shifts on seven days a week, or who is rostered to work regularly on active duties on Saturdays, Sundays and public holidays),
either
a loading of 20 per cent of salary up to a maximum of $473.75 for any one full entitlement of annual leave,
or
the allowances and penalties payable had the employee not been on leave during the relevant period,
whichever is the greater.
1.5.2.3an employee who is employed for part of a year as a shift worker or a seven day week worker is to be paid a loading as prescribed in 1.5.2.2 on a pro rata basis for completed months worked as a shift worker or a seven-day week worker and for the balance be paid a loading as prescribed in 1.5.2.1.”
The effect of the amendment was to remove the prescribed maximum for all shift workers. For the first time, there was no prescribed maximum for any worker. A worker was entitled to either a loading calculated as a percentage of salary or calculated by the alternative expressed in each clause if that should produce a higher award.
There is no evidence of the terms of the award in 1999 and 2000. It is reasonable to infer that in that period there was no prescribed maximum for shift workers. The Industrial Relations Court has proceeded on that footing.
The First Question
I turn to examine the first question which asked whether the entitlement of shift workers to the leave loading payable up to 30 June 1998 is limited to a maximum of $462.50.
Given that the claim concerns the period of six years up to 21 June 2000 and given that the prescribed maximum has varied from time to time, the question is poorly drafted. The question should have been expressed in these or similar terms:
“In the period 1994 to 30 June 1998, was the entitlement of the group of members to the leave loading limited to a maximum amount in respect of any one full entitlement of annual leave where the sum equivalent to the allowances and penalties payable to each particular employee, had the employee not been on leave during the relevant period, exceeded the said maximum and, if it was, what was the maximum from time to time?”
A question in those or similar terms would enable a determination of the question whether or not all methods of calculating the leave loading were subject to a maximum and the amount of the maximum.
It is apparent from the terms of the awards from 1974 up to 30 June 1998 that there was a prescribed maximum but that the maximum varied from time to time. In 1990 that maximum was $425.40. It was increased from time to time to reach the maximum of $462.50 for the period from 1 July 1997 to 30 June 1998. There is no evidence of the amount of that maximum at times other than 1990 and for the period from 1 July 1997 to 30 June 1998. Reference will have to be made to the awards as they existed from time to time to enable a more complete answer to this question.

Thus, from 1990 until 1 July 1998 the Leave Loading Award prescribed a maximum loading which varied from $425.40 in 1990 up to $462.50 until 30 June 1998. On any view, they were clearly the maximum amounts of the loading as prescribed by the Leave Loading Award from time to time to which clause 28(d)(i) of the Nurses Award referred.
The shift workers contend that the terms of clause 28(d)(ii)(2) prevent the maximum from applying to the calculation of weekend and shift penalties to which the clause refers. Shortly stated, they contend that the calculation of weekend and shift penalties is not a loading and, therefore, not subject to the prescribed maximum which, it is urged, applies only to loadings.
The arguments must fail for a number of reasons. First, it is clear that clause 28(d) intends to deal with annual leave loadings. It is headed “Additional Leave Loading” and, in sub-clause (d)(i), provides a loading on top of the amount payable under sub-clauses (a), (b) and (c). Sub-clause (a) does not provide for the calculation of the payment but merely fixes the amount of leave to which employees are entitled and conditions ancillary to that. There is nothing in sub-clause (d) which indicates that it is dealing with anything other than annual leave loadings and associated issues. Simply put, sub-clause (d)(i) provides the entitlement to the loading and specifies a maximum by reference to the Leave Loading Award.
Secondly, in this context, the noun “loading” means an additional amount paid to employees: see Macquarie Dictionary. All of the amounts to which subclause (d)(ii)(2) relates, including weekend and shift penalties, are amounts paid to employees in addition to other payments prescribed by sub-clauses (b) and (c). They are all loadings.
Thirdly, sub-clause (d)(i) prescribes that “each employee” is entitled to a loading. The use of the word “each” means that the loading is payable to all employees without exception, be they shift workers or other workers.
Fourthly, the intention of sub-clause (d)(i) is to create the entitlement to leave loading and to prescribe a maximum. Sub-clause (d)(ii) deals with the calculation of that entitlement and other matters.
Fifthly, sub-clause (d)(ii) opens with the words “the loading shall be applied as follows”. Those words clearly indicate that all that follows is concerned with the loading. The use of the expression “shall be applied” is curious. It will have been noticed that the same expression was used in the Leave Loading Award as it existed from time to time. The verb “apply” can mean “put into practical operation”: see Macquarie Dictionary. But even that reading is not helpful. But, as is apparent, everything which follows the expression “the loading shall be applied as follows” is concerned with calculation or computation of the annual leave loading so that it is plain that the expression is intended to mean “shall be calculated” or “shall be computed”.
Mr Howells, who appeared for the respondent, fastened on the syntax of subclause (d)(ii)(2) for the purpose of seeking to show that weekend shift penalties were not a loading. He submitted that, because the word “either” preceded the words “a loading of 20 per cent …” and the expression “a loading” did not precede the words “the weekend and shift penalties …”, those penalties were not a loading. The argument strains the meaning of plain words. Notwithstanding its ingenuity, the argument must fail. As already noted, the whole intent and purpose of clause 28(d) is to deal with the annual leave loading. Had the drafter been a little more careful, he or she would have expressed that part of subclause (d)(ii)(2) in these terms:
“… a loading of either 20 per cent calculated on the rate of pay as set out in paragraph (b)(i) and subparagraphs (1), (2), (3) and (4) where applicable or of the weekend and shift penalties …”.
Mr Howells also contended that the expression “a loading computed on the normal rate of pay attaching to the classification concerned at the time when the employee commences such leave” could not in terms apply to weekend and shift penalties. He submitted that it referred only to those loadings which represented a percentage of the rate of pay received by the employee in sub-clauses (ii)(1) and (2). I do not agree. As already mentioned, the intention of sub-clause (d) is that subclause (d)(i) creates the entitlement to a leave loading and prescribes a maximum while sub-clauses (d)(ii)(1), (2) and (3) deal with the calculation of the loading. The intention of those words is to express the well-established concept that a worker is entitled to a loading that compensates the worker for all that he would have received as wages or salary had he or she not been on leave. While that principle is recognised, it is nevertheless subject to a prescribed cap or ceiling. Furthermore, the prescribed cap or ceiling would mean that shift workers as well as other workers would all receive a comparable amount by way of a leave loading.
Finally, an examination of the terms of sub-clauses (d)(ii)(3) to (6) clearly reinforces the above conclusions and demonstrates the flaws in Mr Howells’ argument. In each of those sub-clauses either the words “loading” or “leave loading” appear. Each of those clauses has the capacity to operate upon weekend and shift penalties as well as upon other kinds of loading. If Mr Howells’ argument were correct, it would deny any operation to those sub-clauses and would thereby defeat the clear intention of each of those subclauses. It is sufficient to refer to sub-clause (6) to illustrate the flaw in Mr Howells’ reasoning. Sub-clause (6) provides that employees, who have already been paid an annual leave loading and whose rates of pay have been increased with a retrospective date of operation, shall be entitled to an additional amount which will ensure that they get the amount of the annual leave loading calculated by reference to the increased rate of remuneration. Mr Howells’ argument would deny shift workers the capacity to enjoy that benefit. I am sure he does not intend that result.
The reasoning of both the judge at first instance and of the Full Court of the Industrial Court ignores the plain words of the Leave Loading Award as well as its structure. Any doubt as to whether sub-clause (a) prescribes the ceiling is removed by the terms of the Leave Loading Award as it existed in 1990 and 1997 which clearly contains a prescribed maximum which operates in respect of the loading however calculated. The similarity in both the structure and the terms of clause 28(d)(i) and (ii) with the terms of the Leave Loading Award only serves to fortify that conclusion. Plainly it would have been intended to have the same loading operate as widely as possible in the public sector.
Both the judge at first instance and the Full Court of the Industrial Court sought to justify their conclusion by relying on a number of decisions made concerning the Nurses Award or the Leave Loading Award. An examination of those decisions shows that the reliance is quite misplaced.
In the Annual Leave Case (1974) 41 SAIR 300 at 305, the Industrial Commission clearly stated (at 305) that in the federal sphere and in South Australia the tendency had been to fix a specified percentage loading to be added to the pay the worker otherwise received. The Commission recognised (at 307) that some allowance might have to be made for regularly worked overtime but to a maximum of 17.5 per cent. The Commission did not expressly distinguish between seven day shift workers or other workers.
In the Public Service (Recreation Leave Loading) Award Case (1975) 42 SAIR 194, it was recognised that a simple application of a loading of 17.5 per cent would result in some workers on higher levels of salary receiving an unduly, if not an unfairly, high annual leave loading. Judge Olsson imposed a ceiling of $150 which was increased from time to time in subsequent years. In that case the Public Service Association had sought, on behalf of all officers appointed under the then Public Service Act 1967 (SA), an entitlement to an annual leave loading of 17.5 per cent. Judge Olsson recognised that a loading was necessary in order that employees should be entitled to receive a sum above the ordinary rate of pay to compensate for overtime and other allowances which would have been earned by the worker had that worker not been on leave but believed that there should be a maximum. It was inappropriate, he said (at 204 – 205), to fix a 17.5 per cent loading for all employees because that would result in a disproportionately high loading for those employees who earned high salaries. He took the view that, while the loading should be calculated to reflect what the employee would have received had he remained at work, that would be subject to a ceiling, which he called “a prescribed maximum”, of $150. Judge Olsson adjourned the application to enable the parties to prepare a draft award in conformity with his reasons and that award prescribed a ceiling.
The Full Bench of the Industrial Commission revisited the question of annual leave loading in the Public Service (Recreation Leave Loading) Award Case (1978) 45 SAIR 97, when it dealt with an application to vary the Leave Loading Award to delete the maximum which then stood at $195.50. The application was dismissed but the Commission increased the maximum to $203.90. In doing so, it expressly followed and applied the principles enunciated in the Annual Leave Case and the Public Service (Recreation Leave Loading) Award Case (1975) 42 SAIR 194. The Full Bench expressly recognised (at 105) that the original intention of the annual leave loading was designed to ensure that workers on annual leave would receive penalties for overtime regularly worked and which would have been paid had they not been on leave. At the same time, the Full Bench determined that it was necessary to fix a ceiling upon the amount of the loading noting (at 104) that, in all other States but one, annual leave loading was subject to a “maximum limit on the amount which can be paid in any particular case”. The Full Bench saw its task as being (at 108):
“to achieve as nearly as may be the prescription of a maximum amount which ensures at least some broad degree of parity of approach in absolute terms throughout the general work force subject to the awards of the Commission. It must, of course, be recognised that precision in this area is almost impossible, and that a broad axe approach is all that can be achieved”.
The Full Bench then retained the ceiling but increased the amount of that ceiling.
An especial reliance was placed by both the judge at first instance and the Full Court of the Industrial Court on the following remarks of the Full Bench of the Industrial Commission in the Nursing Staff (Government General Hospitals) Appeal Case (1978) 45 SAIR 280 at 288 and in particular on the words which have been emphasised by me:
“ The various parties to the appeal, on different bases of reasoning, sought variations in the Commissioner’s prescriptions dealing with the percentage rate to be applied to employees engaged on shift work or seven day per week employment arrangements. They desired the retention of the pre-existing prescription enabling an employee to obtain the weekend and shift penalties which would have been received had the employee not been on leave during the relevant period if these exceed the ceiling amount. We consider that, on merit, there is an unanswerable argument in favour of such provisions remaining in the award.
This is, of course, not only reinforced by the view which we take as to the prime basis of the allowance of an annual leave loading, but also derives support from the fact that such a prescription has been in force in the award for some considerable period of time and there has been no good reason demonstrated for its present rejection. Moreover, in our opinion, such an approach establishes an equitable basis of recognising the particular positions of the employees to whom it relates.”
The Industrial Court relied on that passage which suggests that shift workers were entitled to receive a loading which exceeded “the ceiling amount”. However, an examination of the events leading to that decision shows that the expression “the ceiling amount” on which the Industrial Court has relied was not the overall ceiling on annual leave loading.
The award for nursing staff was in 1977 determined by the State Industrial Commission. In 1977 Commissioner Lean heard an application to vary salaries and conditions of work. One of the issues concerned the annual leave loading. In 1977 the award contained no provisions as to annual leave or matters ancillary to it. Instead, since 1 July 1975 an agreement had been in existence which provided for annual leave and an annual leave loading. The provisions relating to the leave loading were in these terms:
“Leave Loading – In addition to payments of the ordinary wage and certain allowances a loading is payable up to a maximum of $185 calculated as follows:-
(i) other than seven day shift workers 17½%
(ii)seven day shift workers 20% or weekend shift penalties whichever is the greater.”
It will be noticed that this prescription contained a ceiling of $185 and did not in any respect provide for any exceptions to that ceiling. The application by the Public Service Association sought inter alia the removal of the ceiling. Commissioner Lean removed the ceiling and, in addition, altered the prescription for the leave loading for shift workers so that it was the same as other workers, namely, 17.5 per cent of the rate of pay received. The Public Service Association and the Public Service Board appealed and cross-appealed against this and other aspects of the decision. The Full Bench restored the ceiling but increased it to $203.90, the same amount as had been determined two months earlier in the Recreation Leave Loading Case. It also allowed the appeal of the Public Service Association to reinstate the prescription by which the leave loading was calculated for shift workers. In doing so, it did not entitle the shift workers to exceed the prescribed maximum or ceiling. That is apparent from the terms of the award published in the Industrial Gazette on 20 July 1978 at p 350.
The factors listed below point to the conclusion that the reference to “the ceiling amount”, in the passage at 288 relied on, was made in error and that the Full Bench intended to refer to the percentage calculated on the rate of pay received and not to the overall ceiling on the leave loading.
(1)The prescription which had existed in 1977 which the Full Bench restored did not permit shift workers to receive a loading in excess of the ceiling.
(2)The prescription for shift workers in 1977 had allowed shift workers to receive the higher of 20 per cent of the rate of pay or the penalties. Both were subject to a ceiling.
(3)Commissioner Lean had placed shift workers on the same loading as other workers and the Full Bench was simply restoring the prescription which had hitherto existed for shift workers.
(4)The Full Bench had itself restored the ceiling, albeit increasing it to $203.90.
(5)The reasons of the Full Bench show that it intended to act consistently with its decision only two months earlier in the Recreation Leave Loading Case in which it had retained a ceiling and fixed it at $203.90. There was nothing in the decision in the Recreation Leave Loading Case which enabled a shift worker to exceed the ceiling. Plainly, the Full Bench was concerned to ensure parity in respect of leave loading and, had shift workers been permitted to exceed that loading, the parity would not have existed.
(6)Finally, the prescriptions in the Nurses Award and the Recreation Leave Loading Award relating to annual leave loading are in almost identical terms. Certainly, the structure is the same with both prescribing a means of calculating that loading but, at the same time, fixing a ceiling. Plainly, the Full Bench intended that both awards should be interpreted in that way.
For these reasons, the use of the expression “the ceiling amount” by the Full Bench was plainly a slip of the pen. The Full Bench intended to reinstate the prescription which had enabled shift workers to obtain weekend shift penalties which would have been received if they were an amount greater than the percentage on the rate of pay. The passage, therefore, does not have the significance which the Industrial Court placed upon it. Shortly stated, the passage does not provide any assistance in determining the issues in this claim.
For all of these reasons, it is necessary to allow the appeal for the purpose of amending the answer to the first question asked by the parties. I would answer that question in these terms:
“The entitlement of the group of members to the leave loading varied in the years up to 30 June 1998 but was always subject to a prescribed maximum which maximum applied even where the sum equivalent to the allowance and penalties payable to a particular employee had the employee not been on leave during the relevant period exceeded the prescribed maximum. In the year 1 July 1997 to 30 June 1998 the prescribed maximum was $462.50.”
The Second Question
Since 1998 the Leave Loading Award has not in terms prescribed a maximum. Instead, the Award has at all times since prescribed two methods of calculation for non-shift workers as well as shift workers. In the absence of a prescribed maximum, the loading for annual leave must be calculated in accordance with the Leave Loading Award so that the shift workers will be entitled to a loading calculated at the greater of the two alternatives provided in clause 1.5.2. Plainly, the fact that these alternatives exist is entirely at odds with the requirement in the Nurses Award for a prescribed maximum.
Mr Clayton QC, who appeared for the appellant, submitted that, because the Nurses Award referred to the maximum from time to time prescribed by the Leave Loading Award, it must be interpreted as referring to the maximum specified in respect of that part of the calculation of the loading which is a percentage of salary. However that argument cannot be upheld in that it ignores the plain words which provide alternative means of calculation, one of which only is subject to a cap, and entitles the worker to the greater of the two alternatives if that worker was usually in receipt of penalties. As the shift workers who have made this claim receive penalties, there is no prescribed maximum. Furthermore, to accede to Mr Clayton’s argument would be to ignore the effect of the 1998 amendments to the Leave Loading Award which removed a maximum. His arguments would result in a lack of parity in the public sector. I think the manifest purpose of the reference to the Leave Loading Award was to ensure that parity existed in the public sector.
For these reasons, I would dismiss the appeal in respect of the second question.
Conclusion
For these reasons, I would allow the appeal for the purpose only of varying the order in respect of question one. I would dismiss the appeal in respect of question two. In consequence, the questions and the respective answers would be
1. Q.Whether the entitlement of the group of members to the leave loading payable up to 30 June 1998 is limited to a maximum of $462.50 in respect of any one full entitlement of annual leave where the sum equivalent to the allowances and penalties payable to each particular employee had the employee not been on leave during the relevant period exceeded the said maximum.
A.The entitlement of the group of members to the leave loading varied in the years up to 30 June 1998 but was always subject to a prescribed maximum which maximum applied even where the sum equivalent to the allowance and penalties payable to a particular employee had the employee not been on leave during the relevant period exceeded the prescribed maximum. In the year 1 July 1997 to 30 June 1998 the prescribed maximum was $462.50.
2. Q.Whether the entitlement of the group of members to the leave loading payable from 1 July 1998 to date is limited to a maximum of $473.75 in respect of any one full entitlement of annual leave where the sum equivalent to the allowances and penalties payable to each particular employee had the employee not been on leave during the relevant period exceeded the said maximum.
A.No.

[2002] SASC 345

1 November 2002