s.394 - Application for unfair dismissal remedy

Application for unfair dismissal remedy - jurisdictional objection - whether annual earnings above high-income threshold - Applicant's annual earnings found to be below the high-income threshold - jurisdictional objection dismissed.

[1] On 5 August 2025, Mr Jim Moutsias (the Applicant) lodged an unfair dismissal application seeking remedy in relation to the termination of his employment with Network RV Pty Ltd (the Respondent).

[2] The Respondent objects to the FWC dealing with the application on the basis that the Applicant's annual rate of earnings at the time of dismissal was above the high-income threshold which was $183,100.00 at that time.

[3] The Applicant was engaged by the Respondent as it's Chief Operating Officer (COO). He commenced employment on 20 January 2020 and was terminated on 18th July 2025.

[4] It is not in dispute that at the time of dismissal, the Applicant was on an annual base salary of $150,000.00 per annum. However, the total renumeration package of the Applicant is contested.

[5] The Respondent's position is that the Applicant's total renumeration package also included superannuation contributions ($24,129.96), a fixed annual production bonus of $40,800.00, and a fixed annual car allowance of $20,800.00. They argue that inclusive of these amounts the total annual earnings of the Applicant amounted to a sum of $235,729.96, which is above the high-income threshold.

[6] The Applicant accepts he was receiving a car allowance for using his own vehicle and that this payment was a reimbursement. He submits it should not be counted as earnings. Adding that he also received incentive payments in addition to his annual salary. Arguing that as these payments could not be determined in advance, they do not count as earnings for the purposes of the FW Act.

[7] Section 382 of the Act provides that a person is protected from unfair dismissal if, at the time of being dismissed:

(a) the person is an employee who has completed a period of employment with his or her employer of at least the minimum employment period; and

(ii) an enterprise agreement applies to the person in relation to the employment;

(iii) the sum of the person's annual rate of earnings, and such other amounts (if any) worked out in relation to the person in accordance with the regulations, is less that the high-income threshold.

[8] It is not in dispute that the Applicant has completed the minimum employment period. Nor is it in dispute that the Applicant, who was employed as the Respondent's COO was not covered by a Modern Award or Enterprise Agreement. I am satisfied both these requirements of s.382 have been met.

[9] At this preliminary stage, the parties are in dispute about whether the Applicant's annual rate of earnings is less than the high-income threshold. If I am not satisfied this is the case, the application must be dismissed.

[10] The parties were directed to file evidence and submissions on the question of whether the Applicant's annual earnings were less than the high-income threshold by the 22nd of October. On review of the material filed, I invited the parties to indicate whether they wished to be heard further at a Hearing or were content for the Commission to determine this jurisdictional question on the material filed with the Commission. Neither party requested to be heard further.

[11] On 12 December 2025, I invited the parties to file additional submissions by December 19th. I requested these additional submissions in relation to any evidence of the proportion of the motor vehicle allowance received that was for personal use, and any proportion of the production bonus or commission payment received that was guaranteed, or not at risk. Only the Applicant provided any additional information. The information he provided indicates the commission payments he received varied based on the proportion of production targets he achieved.

[12] I have considered all the material and submissions provided by the parties and for the reasons set out below, I am satisfied the Applicant's annual rate of earnings is less than the high-income threshold for the relevant period.

Were the Applicant's annual earnings over the 183,100 high-income threshold at the time he was dismissed?

[13] Section 333 of the Act provides that the high-income threshold is the amount prescribed by, or worked out in the manner prescribed in the regulations. Regulation 2.13 of the Act provides that as of 1 July 2025 the figure was $183,100.

[14] Section 332 of the Act defines 'earnings' as follows:

(a) the employee's wages; and

(b) amounts applied or dealt with in any way on the employee's behalf or as the employee directs; and

(c) the agreed money value of non‑monetary benefits; and

(d) amounts or benefits prescribed by the regulations.

(2) However, an employee's earnings do not include the following:

(a) payments the amount of which cannot be determined in advance;

(b) reimbursements;

(c) contributions to a superannuation fund to the extent that they are contributions to which subsection (4) applies;

(d) amounts prescribed by the regulations.

Note: Some examples of payments covered by paragraph (a) are commissions, incentive‑based payments and bonuses, and overtime (unless the overtime is guaranteed).

[15] Subsection (3) deals with non-monetary benefits. Subsection (4) in effect provides that superannuation contributions an employer is required to make under relevant superannuation legislation are not considered earnings for the purposes of the Act.

[16] In support of its submissions, the Respondent filed material including a spreadsheet recording the Applicant's earnings for the period July 2024 to June 2025. Relevantly this document records the Applicant received the following payments during this period:

[17] The sum of the above figure amounts to $151,832.93. It is not in dispute that the Applicant's base annual salary for the relevant period was an amount of $150,000.00. Discounting the $1833.26 received as annual leave loading, the details provided by the Respondent support this to be the case.

[18] The spreadsheet provided by the Respondent also indicated the Applicant received additional payments during the relevant period as follows:

[19] The Respondent's case is support by the witness statements of Rajwinder Pannu (Chief Financial Officer) and Shakila Edirisinghe (HR Manager). Both these statements attest that at the time of dismissal the Applicants total annual earnings amounted to a total of $235,729.96 determined as follows:

[20] The Respondent's position is that each of the amounts additional to the Applicant's base salary should be considered earnings consistent with the provisions of s.332 and counted towards the Applicant's total annual earnings, taking them beyond the high-income threshold.

[21] In written submissions, the Respondent argues that the Applicant's commission payments were Production Bonus Payments that were made to the Applicant as fixed amounts payable under a formula linked to production output. Specifically, that the agreement provided if weekly production exceeded a set threshold, the Applicant would receive a fixed amount for each unit produced above that threshold. Adding that this entitlement and the amount to be paid were defined in advance, and that payment was objectively ascertainable once the production figure was known. Submitting that, therefore, these payments fall within the definition of earnings in the Act that should be included in the calculation of the Applicant's annual earnings.

[22] Regarding the Vehicle Allowance, the Respondent submitted that this allowance was a fixed amount paid to the Applicant on a weekly basis that was not a reimbursement of expenses. On this basis, they submit that it also falls within the definition of earnings in the Act and should be included in the calculation of the Applicant's annual earnings.

[23] The Respondent made no additional submissions with respect of the payments made to the Applicant in relation the superannuation. Relevantly, I am satisfied these payments are not considered earnings for the purposes of s.332 by virtue of the provisions in s.332(4) identified above.

[24] The Applicant submits that his total earnings at the time of his termination for the purposes of Act was his base salary of $150,000.00. His position is the $20,800.00 car allowance he was received was a reimbursement for using his own vehicle. And that the $40,800.00 he received as production bonus payment was an incentive-based payment that was at risk and could not in fact be determined in advance. On this basis, he submits the Respondent's jurisdictional objection should be dismissed.

[25] The key issue to determine in this case is whether the production bonus payment received by the Applicant should be included as earnings. If this is the case, the Applicant's earnings are above the high-income threshold, and his application must be dismissed.

• [26] I make this assessment because even if I accept the Respondent's submission that the $20,800.00 the Applicant received as vehicle allowance, which I do not, the Applicant's earnings remain below the threshold. The correct assessment I am required to make with respect of the payments received by the Applicant for the use of his motor vehicle is to determine the proportion of the allowance that can be considered attributable to personal use.[1]

[27] Only such amounts are considered earnings for the purposes of the Act are included in the calculation of annual earnings. In the present case, neither the Applicant nor the Respondent has made any further submissions with respect to the proportion of the $20,800 received by the Applicant that can be attributed to payment for the personal use of his vehicle. Despite this being the case, for the reasons identified above, I am not required to determine this question to finalise this matter.

[28] Turning now to consider the $40,800.00 payment the Applicant received as his production bonus or commission. Section 332(2)(a) makes clear that payments that cannot be determined in advance are not to be considered earnings. The Respondent argues that the bonus payment made to the Applicant was a payment what could be determined in advance because it was an agreed fixed amount that would be paid if weekly production exceeded a set threshold.

[29] The Applicant's position is that these payments were received by him for achieving agreed production targets as an incentive. In short, that he received these payments because he achieved agreed production targets and that while the payment amounts were agreed in advance, whether he received them or not was not guaranteed. Making it clear, he would not have received these payments if he did not achieve the agreed production targets.

• [30] The Respondent has not provided me any further information or submission to established that the production bonus payments made to the Applicant were guaranteed to be received by him. Or to put this another way, that the $40,800 was not at risk if the Applicant did not meet the agreed targets. This being the case, I reject their submission that this payment should be included in my calculation of the Applicant's total annual earnings for the purposes of the high-income threshold. This is not the correct approach, as Commissioner Simpson recently identified in Duffy v Enermech Pty Ltd.[2]

[31] Because of this conclusion, I am satisfied that the evidence before the Commission in this case establishes that the Applicant's total annual earning was an amount of $150,000.00, an amount below the high-income threshold.

[32] Accordingly, the jurisdictional objection is dismissed. The application will now be programmed in the usual way for the merits of the application to be considered.

[1] See Sam Technology Engineers Pty Ltd v Andrew Bernadou [2018] FWCFB 1797 at [72].

[2] [2025] FWC 1670.

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