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The HR Cartel

High-income threshold and maximum unfair dismissal compensation

The high-income threshold is now $167,500 per annum (increased from $162,000). What does this mean for employers?

June 27, 2023

The high-income threshold is now $167,500 per annum (increased from $162,000). What does this mean for employers?

If you have employees who are paid $162,000 or higher, you should consider increasing their guaranteed earnings to at least $167,500.00 – immediately.

Why?

Employees who earn above this “threshold” are excluded from making an unfair dismissal claim – where the employer has a written undertaking to pay that employee, at least the high-income threshold.

Prior to 26 June 2023, your employee earning $162,000 or more (but less than $167,500) was subject to this rule – this isn’t the case today, and your payroll should be updated to ensure that any employees who had guaranteed annual earnings above the high-income threshold continue to be paid above the high-income threshold, from right now, onward.

Of course, there are exclusions

Where your employee is covered by a Modern Award or an Enterprise Agreement, this rule may not apply – but that would be rare. Still, contact us for further information relevant to your specific circumstances.

Unfair Dismissals

Additionally, the maximum compensation for unfair dismissal claims will increase from $81,000 to $83,750.

This is certainly motivation for employers to (a) avoid landing in a dispute, and (b), seriously consider settling matters where ambiguity is present – but again, contact us for further information and assistance on specific matters.

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