Mr Post, Tjeerd v QSuper Limited T/A QSuper

[2014] FWC 8956

[2014] FWC 8956

FAIR WORK COMMISSION

DECISION

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

Mr Post, Tjeerd
v
QSuper Limited T/A QSuper
(U2014/1412)

SENIOR DEPUTY PRESIDENT DRAKE SYDNEY, 15 DECEMBER 2014

Application for relief from unfair dismissal.

[1] I heard this application in Brisbane on Monday, 10 November 2014.

[2] Firstly, there was a dispute as to whether or not the application had been resolved by way of a binding settlement between the parties.

[3] Secondly, the respondent objected to the application on the basis that the applicant earned more than the high income threshold at the date of termination of employment. The applicable high income threshold at the date of termination of employment was $129,300.

[4] Since the applicant did not concede that there was a binding settlement I decided that it was most convenient to first determine the jurisdictional objection of the respondent.

[5] On 10 November 2014 Mr Post tendered a termination calculation. He supplied a submission with five attachments on 14 November 2014 and a further calculation on 18 November 2014.

[6] On 10 November 2014 the respondent tendered an affidavit from a solicitor, Ms Jessup, which went to the first issue; an affidavit from Ms Dierdre Rowe, Human Resources Officer of the respondent going to the second issue, and Submissions from the Respondent. It then provided a Supplementary Submission on 17 November 2014.

[7] The issue in contention is whether or not an amount contributed to Mr Post’s superannuation over and above the 9.5% required to be contributed by the Superannuation Guarantee Charge Act 1992 should be taken into account in assessing the applicant’s remuneration package as at the date of termination of employment for the purpose of considering whether or not his income exceeded the higher income threshold.

[8] The applicant's total remuneration package was $145,600. The total contribution to his superannuation account was 12.5%. The respondent submitted that only the compulsory 9.5% charge was excluded from Mr Post’s total remuneration package for the purposes of assessing whether he exceeded the high income threshold.

[9] Mr Post submitted that the balance of $127,035 after deducting the total 12.5% contribution represented his income for the purpose of assessing whether or not he exceeded the high income threshold.

Conclusion

[10] Section 332 of the Fair Work Act 2009 (the Act) is as follows:

“332 Earnings
(1) An employee’s earnings include:

(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).

(3) Non-monetary benefits are benefits other than an entitlement to a payment of money:

(a) to which the employee is entitled in return for the performance of work; and

(b) for which a reasonable money value has been agreed by the employee and the employer;

but does not include a benefit prescribed by the regulations.

(4) This subsection applies to contributions that the employer makes to a superannuation fund to the extent that one or more of the following applies:

(a) the employer would have been liable to pay superannuation guarantee charge under the Superannuation Guarantee Charge Act 1992 in relation to the person if the amounts had not been so contributed;

(b) the employer is required to contribute to the fund for the employee’s benefit in relation to a defined benefit interest (within the meaning of section 291-175 of the Income Tax Assessment Act 1997) of the employee;

(c) the employer is required to contribute to the fund for the employee’s benefit under a law of the Commonwealth, a State or a Territory.”

[11] Mr Post is a member of the State Public Sector Superannuation Scheme, a fund established by the Superannuation (State Public Sector) Deed 1990 (Qld) pursuant to the Superannuation (State Public Sector) Act 1990 (Qld). By application of this legislation Mr Post's contribution was said to be calculated on his superannuable salary of $127,036.

[12] The respondent's submissions in this regard are set out below:

“11. The Employer Co-Contribution rates are set by section 72(4) of the Deed which states:

‘(d) for a member in the QAS accumulation category or a member in the comprehensive accumulation category who is not a member of the Queensland Police Service -

(i) if the employee contribution rate is 2% - 9.75%; or
(ii) if the employee contribution rate is 3% - 10.75%; or
(iii) if the employee contribution rate is 4% - 11.75%; or
(iv) if the employee contribution rate is 5% - 12.75%;..’

12. The requisite superannuation payments required to be made by the employer under the Deed is 9.75% of the employee’s salary.

13. In circumstances where the employee voluntarily elects an Employee Contribution Rate higher than the minimum 2% under clause 71A(4), the employer will in turn contribute a higher rate of Co-Contribution to the superannuation fund consistent with section 72 of the Deed. In effect, the employee can elect to contribute more of his or her salary to his superannuation (both through Employer Co-Contribution and the Nominated Employee Contributions).

14. Chapter 3 of the Deed imposes a minimum standard for required employer superannuation payments under the Deed, being:

(a) 9.75% Employer Co-Contribution; and
(b) 2% Nominated Employee Contribution.

15. Additional superannuation payments arrangements can be made by the employee nominating a higher Employee Contribution Rate.

16. On this basis, it is submitted that the superannuation payments to which section 332(4) of the FW Act apply, and which therefore should be excluded form (sic) the calculation of the Applicant’s annual rate of earnings, is 9.75%.

17. The Co-Contributions made by the employer in excess of this rate are not payments to which section 332(4)(c) apply.

18. Accordingly, it is submitted that the Applicant’s annual rate of earnings are to be calculated in accordance with section 332 of the FW Act as follows:

Total remuneration package: $145,600.00
Less - Employer Co-Contributions of 9.75% of
superannuable salary $ 12,386.01
Earnings - including Nominated Employee Contribution
Of $2,540.72: $133,213.99

19. The Applicant was dismissed on 4 April 2014. At this date the high income threshold was $129,300, and the Applicant’s total salary package was $145,600. On the basis that the annual rate of earnings for the Applicant is $133,213.99 after applying section 332 of the FW Act, the Applicant is not a person protected from unfair dismissal in accordance with section 382 of the FW Act.”

[13] Mr Post contributed to the superannuation account at the highest rate. That was a voluntary contribution. The minimum and compulsory employee contribution was 2%, giving a 9.75% total contribution. Mr Post’s voluntary employee contribution was 3% higher at 5%, giving a 12.75% total contribution. I am satisfied and find that a higher voluntary contribution is a contribution from income which is properly considered income to be taken into account in assessing whether or not the high income threshold is exceeded.

[14] I am satisfied and find that Mr Post’s application is excluded from the jurisdiction of the Fair Work Commission because, at the date of termination of employment, his income exceeded the higher income threshold.

SENIOR DEPUTY PRESIDENT

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