The higher threshold means more employees can access the
unfair dismissal provisions.
More employees will be able to access the unfair dismissal
provisions in the Fair Work Act following the increase in the high
income threshold to $129,300, effective 1 July 2013.
At the same time, the compensation limit for unfair dismissal
will increase to $64,650.
How is the unfair dismissal high income threshold
An employee's earnings include wages, money
that is paid on their behalf (such as superannuation top-ups or
salary sacrifice), and the agreed value of non-monetary benefits
(such as laptops and mobile phones).
An employee's earnings don't include
payments that can't be set in advance (such as commissions,
bonuses or overtime), reimbursements, or compulsory superannuation
Employees who earn above $129,300 (not including SGC
superannuation) and who are not covered by an award or enterprise
agreement will be excluded from the unfair dismissal regime.
What effect will this have?
The increase will enable more employees to access the unfair
dismissal provisions. This would also have implications for how you
manage these employees.
Of course, even if an employee is award/enterprise agreement
free and earns more than the high income threshold, he or she could
still challenge any dismissal using other mechanisms, including
adverse action and actions for breach of contract.
Clayton Utz communications are intended to provide
commentary and general information. They should not be relied upon
as legal advice. Formal legal advice should be sought in particular
transactions or on matters of interest arising from this bulletin.
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