Increase to “high income threshold”

As of 1 July 2019 the Fair Work Commission has increased the “high income threshold” from $145,400 to  $148,700.

Employees who earn this amount per year (or an amount over this) are unable to bring a claim in unfair dismissal (unless their employment is covered by an enterprise agreement or a modern award, in which case their level of earnings is irrelevant).

Although the operation of the high income threshold means that employers can terminate the employment of certain highly paid employees without the risk of an unfair dismissal claim, employers should be aware that even highly paid employees or very senior employees can be covered by a modern award in some circumstances.

Whether or not a senior employee is covered by a modern award depends on the terms of the award. Some awards will apply to even the highest level of employees. In Ms Veronica Cubillo v North Australian Aboriginal Family Violence Legal Service [2011] FWA 6818 it was found that the Social, Community, Home Care and Disability Services Industry Award 2010 covered the CEO of the organisation.

Employers should therefore be wary of assuming that senior employees who earn over the high income threshold will not be protected by unfair dismissal laws.

In any event, all employees (regardless of earnings or position) are protected by general protections and discrimination laws. These make it unlawful to dismiss someone for a discriminatory reason or because they exercised a workplace right (for example, making a complaint about their employment).

Increase to maximum damages in unfair dismissal cases

The maximum damages available to employees in unfair dismissal cases has also increased from $72,700 to $74,350. Damages in general protections and discrimination claims remain uncapped.

Need help?

If you need help in determining whether a modern award applies to your employees, please contact Employment Innovations. Our subscription services include packages that offer unlimited workplace advice and representation in employment law claims (subject to terms and conditions). If you require legal advice in respect of unfair dismissal, general protections or discrimination claims please contact our team of specialist employment lawyers at EI Legal.