A manager at an actuarial consulting firm, who handled funds over $100 million has had his application for unfair dismissal denied by the Fair Work Commission (FWC).

SMA Pty Ltd (SMA), the manager’s previous employer, defended the manager’s self-represented action against their company for unfair dismissal by arguing that the employee was not entitled to protections under section 382(b) of the Fair Work Act 2009 (Cth) (FWA) because his employment was not covered by an Award.

In order for an action for unfair dismissal to be valid under section 382(b) of the FWA, one or more of the following must apply, in that the employee must:

  • be covered by an Award;
  • be covered by an Enterprise Agreement; and/or
  • not exceed the high income threshold.

No enterprise agreement applied to the manager, nor was he under the high income threshold of $123,300,1 earning $143,532 in total (with a base salary of $131,680).

In order to establish that the manager did not fall within the Banking, Finance and Insurance Award 2010 (the Award), SMA argued that the manager was too senior to fall within the scope of the roles the Award applies to. SMA raised a number of factors highlighting the manager’s seniority, such as:

  • he reported directly to the CEO, and at times not at all (when the CEO was overseas);
  • he was a member of the executive and investment and audit committees;
  • he had a fundamental role in efficient and profitable operation of the business; and
  • had recruitment responsibilities.

The manager tried to deemphasise his seniority, claiming that because of the structure of the company and that 21% of all employees shared his level of reporting he fell within the Award.

Commissioner Gregory rejected these arguments and accepted that the manager was employed at a senior level in the company, stating that managers covered by the Award were unlikely to report directly to the CEO regardless. Further to this, the Commissioner said that middle managers covered by the Award are almost certainly not members of the executive management board or investment committee, or indeed anything with a similar level of seniority and responsibility, including strategic and policy matters.

Considering the responsibility involved in dealing with $100 million in funds under administration held on behalf of 17,000 clients, the Commissioner concluded that the manager was not covered by the Award.

In making his conclusion, the Commissioner applied the “principle purpose” test, that is, he looked at whether an employee under the Award was employed for a “principle purpose” distinct from what the manager was employed to do.

The outcome was that the high income earning, senior manager could not advance a claim in unfair dismissal.