DECISION

Fair Work Act 2009
s.394 - Application for unfair dismissal remedy

David McCappin
v
Kone Elevators Pty Ltd
(U2019/11091)

COMMISSIONER HAMPTON

ADELAIDE, 5 FEBRUARY 2020

Application for an unfair dismissal remedy – jurisdictional objection – high income threshold – whether applicant protected from unfair dismissal by virtue of his level of earnings – management employee not covered by award or enterprise agreement – company made superannuation contributions above the statutory minimum rate and provided an annual car allowance that was paid irrespective of the actual business travel undertaken – whether excess superannuation contributions and the car allowance beyond the cost of business travel form part of the rate of annual earnings – Full Bench authority applied and case not distinguishable – applicant’s annual rate of earnings above the high income threshold – jurisdictional objection upheld – unfair dismissal application dismissed and Order issued.

1. What this decision is about

[1] Mr David McCappin has made an unfair dismissal application to the Fair Work Commission (the Commission) under s.394 of the Fair Work Act 2009 (the FW Act) against Kone Elevators Pty Ltd (Kone).

[2] In opposing the application, Kone has raised a jurisdictional objection contesting Mr McCappin’s eligibility to make this application. Kone contends that Mr McCappin was not a person protected from unfair dismissal by virtue of his annual rate of earnings and the high income threshold that applies in certain circumstances.

[3] Section 382 of the FW Act sets out when a person is protected from unfair dismissal:

“382 When a person is protected from unfair dismissal

A person is protected from unfair dismissal at a time if, at that time:

(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

(b) one or more of the following apply:

(i) a modern award covers the person;

(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 than the high income threshold.”

[4] It is common ground that s.382(a) has been met and that Mr McCappin was not covered by a modern award or enterprise agreement.

[5] Accordingly, the high income threshold is relevant and was $148,700 as at the time of dismissal. 1

[6] It is also common ground that the following remuneration package applied to Mr McCappin at the time of his dismissal:

• Annual base salary of $143,780.00;

• Superannuation contributions of $17,795.25 (being a contribution rate of 12.5% of the annual base salary);

• Car allowance of $20,450.00; and

• Incentive Bonus of up to $18,954.30 (up to 15% of the annual base salary.

[7] The incentive bonus is a contingent payment and it is agreed that this is not relevant for present purposes. 2

[8] I observe that…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading David McCappin v Kone Elevators Pty Ltd

Details

AGLC: David McCappin v Kone Elevators Pty Ltd [2020] FWC 61
Case: [2020] FWC 61
Decision Date: 5 FEBRUARY 2020

CaseChat Overview and Summary

In the case of David McCappin v Kone Elevators Pty Ltd, the applicant sought an unfair dismissal remedy. The primary issue before the court was whether the applicant, a management employee earning above a certain threshold, was protected from unfair dismissal claims by virtue of his income level. The applicant contended that his annual rate of earnings should include certain benefits provided by his employer, such as excess superannuation contributions and a car allowance, which exceeded the cost of actual business travel. The employer argued that these benefits should not be factored into the applicant's earnings for determining eligibility for unfair dismissal protection.

The court examined whether the benefits provided by the employer constituted part of the applicant's rate of annual earnings under the relevant legislative framework. It was noted that the applicant was not covered by an award or enterprise agreement, which complicated the interpretation of what constituted "earnings." The Full Bench authority was applied, and the case was found not distinguishable from precedents that had addressed similar issues. The court concluded that the excess superannuation contributions and the car allowance, which were above the cost of business travel, did form part of the applicant's rate of annual earnings. However, the total earnings were found to exceed the high income threshold, leading to the conclusion that the applicant was not protected from unfair dismissal claims.

As a result, the jurisdictional objection raised by the employer was upheld. The court dismissed the applicant's unfair dismissal application, finding that he was not eligible for the protection afforded by the unfair dismissal laws due to his high income threshold. An order was issued accordingly, finalising the proceedings in the applicant's disfavour.

Orders