With Christmas approaching, we unfortunately see a rise in employees being dismissed from their jobs.
But what happens if you are one of those employees whose earnings put you over the salary cap and may preclude you from lodging a claim for unfair dismissal?
The salary cap
Adjusted annually on 1 July, the salary cap for the 2018/2019 financial year currently sits at $145,400 (excluding superannuation), meaning that employees who earn over this amount may not have access to unfair dismissal.
It is important to note that this amount is before tax and other amounts may be considered to be earnings, such as a vehicle allowance for use of a company vehicle, or the use of a company phone and laptop. If you receive these benefits they may push you up over the cap depending upon their equivalent monetary value.
However, if you are an employee covered by an award or enterprise agreement, your rate of earnings does not matter and you may still be able to lodge for unfair dismissal. You can check award or agreement coverage by using the following link: https://www.fairwork.gov.au/awards-and-agreements/awards/find-my-award/ https://www.fwc.gov.au/search/document/agreement
If you are a public sector employee you will need to check your state industrial commission’s website for award or agreement coverage.
It is also important to note, that claims of unfair dismissal need to be made within 21 days of being dismissed.
What other options are available to me?
There are other protections at law for employees who have been dismissed and there is no salary cap preventing you from making an application. These applications generally do not look at whether an employer had a fair reason to fire you, but rather if the reason for dismissal was unlawful.
The first of these is through the general protections regime which protects employees from having adverse action taken against them, such as being dismissed.
What differentiates unfair dismissal from general protections, is that in these claims you need to demonstrate why the adverse action was taken. An employee cannot have adverse action taken against them for exercising a workplace right (such as making a complaint or inquiry about their employment), due to a discriminatory reason (such as age, race, gender or disability) or engaging in industrial action.
General protections claims involving dismissal also need to be made within 21 days.
Similarly, an employee is protected under anti-discrimination law from being dismissed due to a discriminatory reason. Your rate of earnings is also irrelevant for these claims.
This regime is a particularly good option where you find yourself outside the 21 day time limit. Complaints of discrimination can be made up to 6 months to 1 year after the dismissal occurring. This may be dependent on whether your lodge a complaint with your federal or state human rights commission.
It is also important to check that you have been dismissed with the right amount of notice in accordance with your contract. It is quite common for high income employees and executives to have a period of notice of 4 weeks or even several months, which may financially offset against the inability to apply for unfair dismissal. Failure to provide the right amount of notice may amount to breach of contract.
If you do not have a notice period in your contract, please read our article on reasonable notice: https://www.shine.com.au/blog/employment-law/as-an-executive-can-i-rely-on-the-notion-of-reasonable-notice.
Shine Lawyers - we're here to help
Should you believe that you have been dismissed unfairly, but earn over the high-income threshold, the employment law team at Shine can assess your matter and provide advice as to what options may be available to you. Contact Us today to have one of our experts assess your claim.
Written by Shine Lawyers. Last modified: October 18, 2019.