Worker argues performance bonuses shouldn't count toward income limit for unfair dismissal
20 Jun 2025
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The Fair Work Commission (FWC) recently dealt with a jurisdictional challenge regarding whether a worker's earnings exceeded the high-income threshold, potentially barring him from pursuing an unfair dismissal claim.
The case centred on whether discretionary retention payments should be included in calculating annual earnings for unfair dismissal protection purposes.
The worker argued that retention payments tied to performance criteria and subject to employer discretion should not count towards his annual earnings.
He maintained that despite completing the required conditions, the non-guaranteed nature of these payments meant they fell outside the definition of earnings under the Fair Work Act 2009.
His base salary and allowances totalled $172,248 annually, sitting below the $175,000 high-income threshold.
However, the employer contended that retention payments worth over $23,000 should be included in the earnings calculation, which would push the worker's total remuneration above the threshold and potentially deny him access to unfair dismissal protections.
On 4 April 2025, a project manager applied to the FWC for an unfair dismissal remedy after being dismissed from his employment with an engineering services company.
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