Changes to unfair dismissal claims – high income threshold, compensation cap and filing fees

From this Friday 1 July, 2022, the high income threshold, compensation cap and filing fees for unfair dismissal claims will increase:

  • The high income threshold will increase from $158,500 to $162,000

  • The compensation cap will increase from $79,250 to $81,000

  • The filing fee will increase from $74.90 to $77.80

High income threshold

The high income threshold is relevant to eligibility of an employee to commence an unfair dismissal claim.

To be eligible, an employee must:

  1. Have completed their minimum employment period (12 months for a small business employer, or 6 months otherwise);

    AND

  2. Either:

a.    Earn less than the high income threshold; OR

b.    Be covered by a modern award; OR

c.    Be covered by an enterprise agreement.

This means that if an employee’s annual earnings exceed the new high income threshold of $162,000, they need to be covered by a modern award or enterprise agreement in order to be protected by fair dismissal laws.

Compensation cap

The compensation cap is the maximum amount the Fair Work Commission can order in compensation in an unfair dismissal claim.

The new compensation cap is $61,000, being half of the high income threshold.  

If you are an employer or employee with questions about unfair dismissal please contact our experienced employment law team.  

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