Paying attention to pay structure
Looking at both sides of the issue

By Graham Howatt
Armed Forces Federation of Australia

As we “drill down” into the establishment of a banded pay structure for officers, the complexities and complications associated with doing so become more and more apparent.

That is not to say the Federation does not support the concept of a graded pay structure for officers, because we do. It is simply a matter of using the right building blocks for the structure.

We have already suggested to the ADF and the DFRT that using the Qualification and Skills (Q&S) components of selected environmental allowances (Submarine Service Allowance, Specialist Operations Allowance, Special Action Forces Allowance and Flying Allowance) to initially establish a 12 banded pay structure is flawed.

The Q&S factor has played a significant part in the RRP process. In August last year these components were deemed to be salary for the purposes of superannuation under Phase 2. That in itself was a major achievement for the RRP but there is nothing more to be gained by rolling Q&S into salary. In fact, it is more likely to be to the detriment of ADF recipients rather than an advantage.

As it stands, it is mandatory under the Defence Act for the DFRT to review salary-related allowances every two years. If Q&S is rolled into salary that component will become invisible and no longer subjected to review when salary-related allowances are presented to the DFRT. Such reviews, more often than not, result with an increase to the allowance. Under the ADF proposal, this will be lost.

It may be convenient to argue Q&S recognises varying degrees of work value and establish the 12 pay bands accordingly. But such a structure would only accommodate officers in receipt of the relevant allowance. Subsequent pay band placement of officers would require them to equate to one of the Q&S bands. That may not be equitable or industrially sound. Perhaps it would be better to establish differential pay bands based on percentage increases, similar to the current OR structure and disregard Q&S altogether.

Having mentioned ORs, if Q&S is rolled into salary for officers, it will also require the ADF to develop an even more complex and unnecessary pay structure for the ORs. Otherwise we would have a situation where ORs have their Q&S reviewed every two years and officers won’t.

The Federation understands the ADF is attempting to address the additional complications and complexities associated with the Q&S factor being rolled into salaries for reservists and for superannuation, but if this factor was left out of the RRP equation, none of this would be necessary.

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