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A quandary of awards, good pay and unfair dismissals

Excerpts from this article first published in ‘Human Resources’ Magazine, Issue 76, 22 March 2005

In G Dunphy and Simon Engineering Pty Limited, a full bench of the Australian Industrial Relations Commission (AIRC) has ruled that Mr Dunphy could not proceed with his application for unfair dismissal against his former employer, Simon Engineering, because he was not employed under ‘award conditions’

The Workplace Relations Act 1996 excludes applications for unfair dismissal by employees who earn in excess of the remuneration limit, which is currently $90,400, and who are not employed under award conditions. An employee is taken to be employed under award conditions if both his or her wages and conditions of employment are regulated by a Federal Award, Certified Agreement, or Australian Workplace Agreement (AWA), that binds the employee’s employer.

In the proceedings leading to the decision, which was an appeal by Mr Dunphy against an earlier decision of the Commission, both parties agreed that Mr Dunphy earned in excess of the remuneration limit set by the Workplace Relations Act. The dispute between the parties was whether Mr Dunphy was employed under Award Conditions. If he was he could proceed with his unfair dismissal application regardless of his level of remuneration.

In finding that Mr Dunphy was not employed under award conditions, the AIRC was satisfied that the work performed by him, which involved planning, allocation and inspection of work did not fit within any classification contained in the Federal Award, the National Electrical, Electronics and Communications Contracting Industry Award 1998, that was binding on his employer.

The New South Wales Industrial Relations Act contains a similar although not identical provision to that of the Workplace Relations Act being considered by the AIRC in the above case.

Under both Acts, 'remuneration' has been held to have a wider meaning than salary or wages. Therefore, in determining an employee’s remuneration, regard may be had to non-wage benefits such as private use of a motor vehicle or phone, and employer contributions to superannuation. 'Remuneration' is defined differently in legislation applying in other states.

HR Tips

If an employer wishes to challenge an employee’s unfair dismissal application on the basis that the employee earned in excess of the remuneration limit and is not employed under an award, enterprise agreement or certified agreement or AWA, the employer must prove that.

It is not sufficient that the employee has a title that is not included in the award or agreement. It is essential that the work the employee does, as a manager for example, does not fall within any of the classification descriptions contained in the relevant instrument.

Gordon Jervis

Senior Associate

Australian Business Lawyers