Pires and Comcare
[2004] AATA 1219
•19 November 2004
Administrative
Appeals
Tribunal
DECISION AND REASONS FOR DECISION [2004] AATA 1219
ADMINISTRATIVE APPEALS TRIBUNAL )
) No N2002/1957
GENERAL ADMINISTRATIVE DIVISION ) Re VIRIATO PIRES Applicant
And
COMCARE
Respondent
DECISION
Tribunal Mr M D Allen, Senior Member Date19 November 2004
PlaceSydney
Decision The decision under review is affirmed.
(Sgd) M D Allen
.............................................. Senior Member
CATCHWORDS
Workers Compensation: Applicant claims his weekly earnings prior to being injured included a sum of money for overtime worked – whether working overtime is a requirement of Applicant’s contract of employment – pursuant to Industrial Award, Applicant could not be compelled to work overtime and was therefore not “required” to do so – decision under review affirmed.
Safety, Rehabilitation and Compensation Act 1988 – s 8, s 9
Australian Defence Industries (Paid Rates Employees) Award - A497
Re Zarb and Comcare (1997) 48 ALD 718
Re Ganchov and Comcare (1990) 19 ALD 541
REASONS FOR DECISION
19 November 2004 Mr M D Allen, Senior Member 1. By application made the 19th day of December 2002 the Applicant sought review of a “reviewable decision” by the Respondent dated 19 June 2002 that determined that the Applicant’s rate of Normal Weekly Earnings prior to his being injured on 12 May 1999 was in the sum of $860.17. The Applicant’s claim is that his normal weekly earnings was in the sum of $1,005.80.
2. The difference in calculations was basically caused by competing interpretations of subsections 8(1), 8(2) and 8(5) of the Safety, Rehabilitation and Compensation Act 1988 (“SRC Act”). Those subsections read:
“(1) For the purposes of this Act, the normal weekly earnings of the employee (other than an employee referred to in subsection (2)) before an injury shall be calculated in relation to the relevant period under the formula:
(NH x RP) + A
Where:
NH is the average number of hours worked in each week by the employee in his or her employment during the relevant period;
RP is the employee’s average hourly ordinary time rate of pay during that period; and
A is the average amount of any allowance payable to the employee in each week in respect of his or her employment during the relevant period; other than an allowance payable in respect of special expenses incurred, or likely to be incurred, by the employee in respect of that employment.
……..
(2) Where an employee is required to work overtime on a regular basis, the normal weekly earnings of the employee before an injury shall be the amount calculated in accordance with subsection (1) plus an additional amount calculated in relation to the relevant period under the formula:
NH x OR
Where:
NH is the average number of hours of overtime worked in each week by the employee in his or her employment during the relevant period; and
OR is the employee’s average hourly overtime rate of pay during that period.
……
(5) Where, because of the shortness of the relevant period, the normal weekly earnings as calculated in relation to the relevant period under subsection (1) or (2) would not fairly represent the weekly rate at which the employee was being paid in respect of his or her employment before the injury, the normal weekly earnings before the date of the injury shall be calculated in relation to such other period as Comcare considers reasonable for the purpose of arriving at an amount that does fairly represent the weekly rate at which the employee was being so paid.
……”
Whereas s 9 SRC Act reads:
“(1) For the purposes of calculating the normal weekly earnings of an employee before an injury, a reference in section 8 to the relevant period is, subject to this section, a reference to the latest period of 2 weeks before the date of the injury during which the employee was continuously employed by the Commonwealth or a licensed corporation.
(2) Subject to subsection (3), if, during the period referred to in subsection (1), the minimum amount per week payable to an employee in respect of his or her employment by the Commonwealth or a licensed corporation was varied as a result of;
(a) the operation of a law of the Commonwealth or of a State or Territory; or
(b) the making, alteration or operation of an award, order, determination or industrial agreement, or the doing of any other act or thing, under such a law;
Any part of that period that occurred before the variation, or last variation, took place shall be disregarded for the purposes of calculating the relevant period.”
3. The real question to be answered by the Tribunal was, however, whether in terms of ss 8(2) SRC Act the Applicant had during the relevant period been “required to work overtime”.
4. During closing submissions there was a submission by the Respondent that the Applicant had not in fact worked “regular” overtime. I reject this submission entirely. On the evidence before me I find that the Applicant did in fact regularly work overtime.
5. Without canvassing the evidence in any great detail I also find that the Applicant’s employer ADI Limited (formally Australian Defence Industries) entered into contracts for the repair of vessels both naval and civilian at its Garden Island Dockyard where the Applicant is employed, and that those contracts contain penalty clauses so that if the contract runs overtime there will be costs incurred by ADI Limited or a loss of profits by that company.
6. As a result of the penalty clause provisions and also because of Defence Imperatives eg. the need to have a naval vessel operational by a set date, there is a regular and ongoing necessity that workers employed at the Garden Island Dockyard will be requested by their employer to work overtime.
7. This need for overtime may be caused by it being inbuilt into the repair schedule or caused by the discovery of a previously unknown defect during the course of a repair or refit.
8. The Applicant’s evidence was that he worked overtime whenever asked. He further stated that to work overtime was not a matter of choice as he understood that the relevant Industrial Award and Workplace Agreement required him to work overtime.
9. I do not accept the Applicant’s evidence as to overtime being something regarding which he had no choice. His supervisor Mr Lovegrove gave evidence of asking the Applicant to work overtime on 5 July 2003 and of the Applicant refusing because of personal circumstances.
10. Further, Mr Lovegrove stated in uncontradicted evidence:
“Any available overtime is purely voluntary. The employees can either decline or accept it. A few people within the Dock Group do not work overtime at all. There is one employee who works very little overtime at all and, in fact, I try to work around his desire not to do overtime. If I put enough pressure on this employee, he will work overtime, however, I cannot force him to do it if he refuses. Another employee will often decline the overtime, saying he cannot do it as he has something else planned for the day.”
11. Mr Farrow is the Marine Operations Manager at ADI Limited and is responsible for the day to day running of production at Garden Island Dockyard. He stated in evidence that he had never had occasion to counsel an employee regarding a refusal to work overtime. He added:
“We have never had to force anyone to do overtime. The Enterprise Bargaining Agreement says that we may require employees to work reasonable overtime, but we have never invoked that. We may apply pressure on people to do overtime, but they can always say no.”
12. In his statement of evidence Mr Gocher, the former Assistant Operations Manager at ADI Limited (now Project Manager ) stated:
“When I offer an employee overtime, I do not know what is going to happen. The employee may say yes, or may say no. There is a very general idea that employees will do 15 hours of overtime per week, however, there is no compulsion for the employees to do overtime. If an employee says no to doing overtime, I just accept that, moving on to the next employee and offering it to them. The excuses for refusing to perform overtime can be any reason, and I accept them. It is each employee’s choice at the end of the day whether they do the overtime or not.
That is not to say that, when I need employees to work overtime, I will not apply pressure to them to do the overtime. However, they still have the option to say no, for whatever reason they put forward. It is entirely their choice at the end of the day.”
and he added:
“If I cannot get the men to do overtime, then I get labour hire staff to assist.
…”
13. The above statements by managerial staff at the Garden Island Dockyard were not challenged in cross examination and the Applicant’s representative conceded during submissions that in the industrial climate that exists at Garden Island Dockyard, the dismissal of an employee for refusing to work overtime simply would not happen.
14. Whereas I am satisfied that as a matter of practicality an employee would not be penalised for refusing to work overtime, the question remains as to whether it is a “requirement” of his contract of employment that he work overtime.
15. I do not consider situations where the Applicant’s Union has been brought before the Industrial Relations Commission by ADI Limited following a collective refusal by its members to work overtime as a tactic in an industrial dispute to be relevant to the question of whether employees are required to work overtime by their contract of employment. That situation is a totally different case to the question to be resolved in this matter.
16. Employees such as the Applicant are employed by ADI Limited subject to the Australian Defence Industries (Paid Rates Employees) Award – A497, and the ADI Marine Enterprise Agreement 1998.
17. Clause 14.3 of the Award reads:
“Requirement to work reasonable overtime.
The company may require any employee to work reasonable overtime as demonstrably required by the task in hand having regard to the personal requirements of the employee.”
18. Clause 7.8 of the Enterprise Agreement refers to overtime but simply sets out the hours and conditions of overtime when worked on Saturdays and Sundays. It provides a gloss to clause 14.3 of the Award but cannot affect the interpretation of clause 14.3 or of the SRC Act 1988.
19. If the relevant clause of the Award had simply read: “the company may require any employee to work reasonable overtime as demonstrably required by the task in hand” then there would be no question but that there existed a “requirement” for the employee to work overtime. However the words “having regard to the personal requirements of the employee” demonstrate that the requirement is not absolute.
20. In reZarb and Comcare (1997) 48 ALD 718, Deputy President Burns said:
“The tribunal has formed the view that the word “required” should be given its ordinary everyday meaning in the context in which it appears. In the Tribunal’s opinion, the ordinary everyday meaning of “required” is the imposition, by the employer in an authoritative fashion, of an obligation upon the employee to work overtime on a regular basis. If the applicant’s view were to be adopted, namely that “required” means the employer “needed” someone to work overtime, regardless of who that employee might be, then it is arguable that any overtime at all would be “required”. This would render the word “required” superfluous.
Support for the Tribunal’s view is to be found in the Macquarie Dictionary (Second Edition) which relevantly defines “required” as follows:
….. to call on authoritatively, order, or enjoin (a person, etc) to do something … to ask for authoritatively or imperatively; demand … to impose need or occasion for; make necessary or indispensable: … to call for or exact as obligatory … to place under an obligation or necessity … to make a demand; impose obligation or need …
The applicant acknowledged that he worked overtime of his own free will and volition. There was no compulsion or obligation involved and he made himself available to work overtime at short notice. It was within his power to refuse to work overtime like so many other intensive care unit staff. Clearly the applicant was not ‘required' to work overtime within the meaning of s 8(2) and the tribunal so finds. It must also be remembered that s 8(2) is not directed at accommodating employees who are required to work overtime but at those who are required to work overtime on a regular basis.”
21. The Applicant’s representative submitted that re Zarb had been wrongly decided. In re Ganchov and Comcare (1990) 19 ALD 541 at 542 Deputy President Todd stated at paragraph 41:
“The Tribunal is not legally required to apply a strict doctrine of precedent. It is not a court, and is not a last resort;… It is however, I believe time to say that unless decisions of the President are followed by all within the Tribunal, and unless the decisions of presidential members (which of course includes deputy presidents) clearly dealing with a point in issue are followed within the Tribunal, the Tribunal could gain the reputation for inconsistency if not disarray. In critical cases it is certainly in my view open to a member to note his or her disagreement with a precedent decision, but it is not desirable for members to adhere to views that appeal to them when the point has been decided otherwise at a higher level. That is not to say, however, that members are not entitled to express their own views for the record, as I have done here. For the rest, as the whole question of following previous decisions is related solely to questions of law, a disappointed party has a right of appeal if the view of such a would-be dissentient from the precedent case is seen as compelling.”
22. Re Zarb (supra) was not appealed and I therefore propose to follow the interpretation of ss 8(2) SRC Act adopted in re Zarb and with which, with respect, I agree. Thus while I find that there was an expectation that the Applicant would be called upon to work overtime and that he felt a strong moral obligation to work overtime when his personal circumstances permitted he was not, by the terms of his contract of employment as set out in the relevant Industrial Award, compelled to work overtime and was not therefore “required” as that word is used in ss 8(2) SRC Act.
23. During submissions the Respondent argued that the calculations of normal weekly earnings in the reviewable decision had been incorrectly performed. The delegate of the Respondent in making the reviewable decision had followed the formula set out in re Zarb (supra). Again I see no reason why I should not follow the decision in re Zarb which was not appealed by the Respondent in that matter and who is the same Respondent as in these proceedings. Further it would appear that re Zarb (supra) has been relied upon and followed by determining authorities since it was delivered.
24. For the reasons stated above therefore the decision under review will be affirmed.
I certify that the 24 preceding paragraphs are a true copy of the reasons for the decision herein of:
Senior Member M D Allen;
Signed: (E.Pope) .....................................................................................
AssociateDates of Hearing 11 and 12 November 2004
Date of Decision 19 November 2004
Representative for the Applicant Ms J Taverner
Counsel for the Respondent Mr A Moulds
Solicitor for the Respondent Hunt & Hunt
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