328Employer obligations in relation to guarantee of annual earnings

328 Employer obligations in relation to guarantee of annual earnings

Employer must comply with guarantee

(1) An employer that has given a guarantee of annual earnings to an employee must (subject to any reductions arising from circumstances in which the employer is required or entitled to reduce the employee’s earnings) comply with the guarantee during any period during which the employee:

(a) is a high income employee of the employer; and

(b) is covered by a modern award that is in operation.

Note 1: Examples of circumstances in which the employer is required or entitled to reduce the employee’s earnings are unpaid leave or absence, and periods of industrial action (see Division 9 of Part 3‑3).

Note 2: This subsection is a civil remedy provision (see Part 4‑1).

Employer must comply with guarantee for period before termination

(2) If:

(a) the employment of a high income employee is terminated before the end of the guaranteed period; and

(b) either or both of the following apply:

(i) the employer terminates the employment;

(ii) the employee becomes a transferring employee in relation to a transfer of business from the employer to a new employer, and the guarantee of annual earnings has effect under subsection 316(2) as if it had been given to the employee by the new employer; and

(c) the employee is covered by a modern award that is in operation at the time of the termination;

the employer must pay earnings to the employee in relation to the part of the guaranteed period before the termination at the annual rate of the guarantee of annual earnings.

Note: This subsection is a civil remedy provision (see Part 4‑1).

Employer must give notice of consequences

(3) Before or at the time of giving a guarantee of annual earnings to an employee covered by a modern award that is in operation, an employer must notify the employee in writing that a modern award will not apply to the employee during any period during which the annual rate of the guarantee of annual earnings exceeds the high income threshold.

Note: This subsection is a civil remedy provision (see Part 4‑1).