On 1 July 2016, the unfair dismissal high income threshold will rise to $138,900.  On the same date, the minimum wage will increase by 2.4%.

Except where an employee is covered by a modern award or enterprise agreement, from 1 July 2016, an employee whose annual rate of earnings is $138,900 or above will not be eligible to bring an unfair dismissal claim in relation to termination of employment.

Generally speaking, for the purposes of determining an employee’s annual rate of earnings:

  • include wages, amounts applied or dealt with in any way on the employee’s behalf or as the employee directs (ie. voluntary superannuation contributions) and the agreed monetary value of non-monetary benefits;  
  • do not include statutory superannuation contributions, payments that cannot be determined in advance (irregular overtime, commissions, incentive-based payments or bonuses) and reimbursements.  

From 1 July 2016, the national minimum wage will increase by 2.4% to $672.70 per week (or $17.70 per hour).  This will impact employers who pay employees modern award wages.  As a result, we recommend that employers confirm the amount of any increased minimum wage payable under relevant modern awards applicable to their workforce.