Pay to govern access

EMPLOYEES earning more than $90,000 in salary can no longer take unfair dismissal action in the Western Australian Industrial Relations Commission.

This was one of the changes made to WA’s industrial relations laws last year and means people in that income bracket will have to go to the district or supreme courts if they feel they were unfairly dismissed.

Instead of arguing an unfair dismissal case they would probably have to argue a case of breach of contract and sue for damages.

In part the move seems designed to prevent such unfair dismissal cases becoming too legalistic and drawing a supporting cast of epic proportions to the commission.

However, one of the issues vexing legal experts is what constitutes salary. Is it base salary or does it include commission, bonuses and things such as superannuation or the provision of a motor vehicle.

There have been no cases to date testing what is meant by the term ‘salary’.

Clayton Utz partner Glen Bartlett said he believed salary was take-home pay.

In the Federal system and some other State jurisdictions, the cap describes remuneration.

Mr Bartlett said he believed the salary provision in the WA system related solely to base salary, while the Federal’s remuneration term roped in other elements of an employee’s package such as superannuation, commission, bonuses and motor vehicles.

“My feeling is that salary should be regular money that the person receives,” he said.

WA was one of the last to introduce a cap on unfair dismissal actions. There has been a cap in the Federal system for several years.

Opinion is also divided over whether the cap is a good thing.

One argument is that just because a person is earning more than $90,000 a year does not automatically mean that they will be able to fund what would most likely be an expensive court action.

The commission is seen as a cheap option because it costs just $50 to start proceedings and, even if the employee loses, the commissioner or registrar handling the case cannot make an order related to costs.

On the other side the argument is the belief that unfair dismissal cases concerning high-wealth individuals can become too legalistic for the WAIRC.

Take, for example, the recent unfair dismissal case of Roderick Smith, who launched a $500,000 claim before the commission after he was dropped from Danny Hill’s stable of companies.

The case dragged on for 20 days, a particularly long time for a matter before the commission, and involved QCs representing both parties.

History shows the matter also ended badly for Mr Smith when commissioner Jennifer Smith found that Mr Hill had been justified in sacking him.

Jackson McDonald partner Maria Saraceni said the introduction of such heavyweight legal players into the WAIRC was a concern because very few of the commissioners and registrars on the bench were lawyers.

“In the Australian Industrial Relations Commission none of the commissioners based here is a lawyer either,” she said.

Ms Saraceni said cases such as the Roderick Smith one should have been dealt with in a proper court.

There is also a concern that executives will start having clauses such as ‘I will not be unfairly dismissed’ introduced into their employment contracts.

Gadens Lawyers national workplace relations practice head Allan Drake-Brockman said this was a distinct possibility.

“In the law if you cut off an avenue people will find a way around it,” he said.

“In many instances these cases will come down to whether a reasonable period of notice was given.”

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