Australia's Fair Work Commission ("FWC"), the
country's industrial relations tribunal responsible for, among
other things, setting and maintaining a safety net of minimum wages
and other employment conditions under the Fair Work Act
2009 (Cth), recently handed down its decision in Dart v.
Trade Coast Investments Pty Ltd (June 29, 2015). The decision
clarifies when personal use of company-supplied devices can be
included in the calculation for determining whether the employees
are eligible to file a claim alleging unfair dismissal in breach of
the Fair Work Act.
Australia's national workplace relations system allows
eligible employees who believe that they were unfairly dismissed to
apply for an unfair dismissal remedy with the FWC. To make an
unfair dismissal claim, an employee must either be covered by a
statutory modern award1or earn
less than the high income threshold. The high income
threshold is reviewed and adjusted annually. On July 1, 2015, this
threshold was increased from $133,000 to $136,700.
In previous decisions, including Maturu v. Leica Geosystems
Pty Ltd (29 September 2014), the FWC held that in determining
whether the high income threshold had been met, an employer could
not rely on non-monetary benefits such as the employee's
non-work-related use of a company laptop and company-paid broadband
internet. Previous FWC decisions were based on Fair Work Regulation
3.05(6), which provides that non-monetary benefits can only be
included in calculations for the high income threshold where the
benefit has been agreed upon between the employee and the employer.
In the Maturu decision, when looking at the language of
the employment contract, the FWC determined that no such agreement
existed. Therefore, the FWC held that the cost associated with the
employee's personal usage could not be included in the
calculation of salary and benefits to meet the high income
threshold. The employee's contract in that case did not specify
that personal usage was permitted.
In Dart, the employee had been provided with a company
phone and iPad and, despite the employment contract's language
that did not stipulate that personal use was permitted, the FWC
found that the parties had an oral agreement that conferred such
authority. Furthermore, the FWC seemed prepared to consider the
evidence on the percentage of the employee's personal versus
work-related usage of the devices, including the number of the
employee's personal photos saved in both devices. According to
the FWC, this clearly supported the company's argument that the
employee's personal usage was significant. Ultimately, the
employee's income was deemed to exceed the then-existing high
income threshold and, therefore, Dart's application
for unfair dismissal was dismissed.
The decision clarifies the importance for employers with
operations in Australia of adequately characterizing employee
permissible usage of company-supplied devices in employment
contracts and policies so that significant personal usage can be
appropriately included in the total value of the employee's
compensation package. This is particularly important for any
employees who may be remunerated at a level that is close to the
high income threshold. Employers are also advised to review their
employment contracts annually around July 1 in line with regular
increases to the high income threshold.
1. Modern awards are industry- and occupation-specific
statutorily mandated minimum terms and conditions that apply to
certain employers and employees who perform work covered by the
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about your specific circumstances.
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An employee that refused a reasonable offer of settlement was ordered by the FWC to pay his ex-employer's legal costs.
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