What is the high income threshold and how might it affect me?

Updated 1 July 2024

The high-income threshold is one factor that may prevent an employee from being able to pursue an unfair dismissal application. Currently, if you earn more than $175,000.00 per year, you will fall above the high-income threshold set out in the Fair Work Act 2009 (the Act).

In determining whether you are able to pursue an unfair dismissal application, there are two questions that you need to ask.

1. What are my earnings?
2. Am I covered by an award or agreement?

What are earnings’?

Not all the money that is paid to you during the course of your employment will count as ‘earnings’ for the purpose of the high-income threshold.

The following will count as ‘earnings’:

1. your salary;
2. the agreed value of any non-monetary benefits that you receive through your employment (such as the private use of a company car); and
3. superannuation contributions over and above the compulsory minimum

In contrast, compulsory superannuation contributions (known as superannuation guarantee payments), bonus payments or any other amounts that cannot be predetermined, will be excluded from the definition of ‘earnings’ under the Act.

Am I covered by an award or agreement?

If you have determined that your ‘earnings’ are over the current high-income threshold, you will not be able to pursue an unfair dismissal application unless you are covered by an award or an agreement.

There are over 120 awards in Australia and thousands of agreements that cover workers in the national employment system.

Being ‘covered’ by an award or agreement is not the same as being paid pursuant to the terms of an award or agreement. In order to determine if you are ‘covered’ by an award or agreement, you will need to refer to the coverage clause in the applicable award or agreement.

Assessing whether you are ‘covered’ by an award or agreement usually involves considering whether the instrument applies to your employer (usually based on the industry in which you work), and whether your role falls within the classifications set out in the instrument. The Fair Work Ombudsman can assist workers in determining whether they are covered by an award or an agreement.

If you are covered by an award or an agreement and you believe your employment has been terminated unfairly, then the high-income threshold will not prevent you from pursuing an unfair dismissal application.

Get help from an employment lawyer

If you’ve been dismissed and you believe that dismissal is unfair or unreasonable, you should seek advice from a lawyer experienced in employment law. 

Contacting Hall Payne Lawyers

You can contact us by phone or email to arrange your consultation; either face-to-face at one of our offices, by telephone or by videoconference consultation.

Phone: 1800 659 114
Email: general@hallpayne.com.au