From 1 July 2015 the minimum adult weekly wage has risen a few dollars to $656.90 for the standard 38 hour week. That’s $17.29 an hour.
And at the other end of the spectrum the high income threshold has increased to $136,700. This means award and enterprise agreement free employees who earn over the high income threshold are not eligible to make a claim for unfair dismissal. The compensation limit that the Fair Work Commission can award if an ex-employee is successful has also risen, to $68,350.
What makes up that $136,700 is not always as obvious as might be thought. When calculating ‘earnings’, the following payments are included in the high income threshold:
- salary sacrifice amounts;
- agreed value of non-monetary benefits; and
- other payments that can be determined in advance.
And the Regulations to the Fair Work Act have quite a bit to say about what can be counted as non-monetary benefits, and how their value is to be assessed.
Most recently the Fair Work Commission looked at whether overtime payments paid to a health and safety training co-ordinator were guaranteed, thereby pushing the employee beyond the high income threshold. Given the overtime worked could be determined in advance the Commission decided the overtime payment qualified as wages and were to be included in the total.
And in another case a manger was pushed over the threshold by his personal use of a motor vehicle, and a lot of personal calls on the work phone. Even a notional amount for his personal use of the iPad was attributed based on 610 personal photos, eight videos and a Clip Organiser app, compared to just 21 work related items.
These decisions are reminders to consider all aspects of a worker’s income and benefits when reviewing whether a person is under or over the new high income threshold and may have no access to the unfair dismissal regime. Understanding who is in and out will also allow you more scope when performance managing.