The Court held that the annual salary loading allowance (17.5% of four weeks' salary) paid to Victorian government school teachers was neither part of the 'notional earnings base' for pre-1 July 2008 periods nor part of 'ordinary time earnings' for post-1 July 2008 periods under the SGA Act. For the pre-2008 period, the allowance was excluded from the definition of 'salary' in the State Employees Retirement Benefits Act 1979 (Vic) and State Superannuation Act 1988 (Vic) as a 'recreation leave allowance', construed broadly to capture allowances that were in substance recreation leave allowances regardless of labelling or payment mechanics. For the post-2008 period, applying BlueScope Steel, the Court held that a lump sum payment contingent on employment on a particular date, paid over and above salary for ordinary hours, could not be characterised as 'earnings in respect of ordinary hours of work' — and that the absence of a link to overtime or annual leave loading was not determinative, as there is no statutory anchor for the proposition that a payment must be analogous to annual leave loading to fall outside OTE.
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