Marcellus,
Your point of compounding interest is true, however, the assumption
Pilot A negotiates a 3% p/a increase inline with Qantas corporate policy
is a very big IF. QF is well aware of the effects of compounding interest and has a track record of delaying pay increases and stalling negotiations.
What is also worth noting is what the cost would be if some of QF's bigger ticket asks had been agreed to.
I believe that the backpay determination was meant to say to both employers and employees that there is no advantage to stonewalling for a determination for backpay.