Jul 072012
 
UPDATE – 1 July 2014
 
High Income Threshold and Compensation Cap for Unfair Dismissal Applications – 1 July 2014.

The Unfair Dismissal high income threshold is $133,000 and the compensation cap is $66,500.

From 1 July 2014 the High Income Threshold increased from $129,300 to $133,000.

Employees earning more than $133,000 cannot make unfair dismissal claims unless they are covered by a modern award or enterprise agreement.

The maximum compensation for unfair dismissal applications is the lesser of 6 months pay and $66,500.

The High Income Threshold calculation includes the following when calculating income:

  • Wages;
  • Superannuation;
  • Money paid on behalf of the employee (e.g. salary sacrifice); and
  • The agreed monetary value of non-monetary benefits (e.g. company car or mobile phone).
The High Income Threshold calculation does not include:
  • Payments which cannot be determined in advance (e.g. commissions, incentive-based payments and bonuses);
  • Overtime (unless the overtime is guaranteed); and
  • Reimbursements.

Redundancy – Tax Free Amount

From 1 July 2014, the Tax Free Amount  for genuine redundancy payments  increased from $9,246 to $9,514 plus an increase from $4,624 to $4,758 per completed year of service.

Employment Termination Payments (ETP)

The cap for the  lower tax rate on ETPs increased from $180,000 to $185,000 on 1 July 2014.

Superannuation

From 1 July 2014, the Superannuation Guarantee Contributions Rate increased from 9.25% to to 9.5%:  the maximum quarterly contribution base increased  from $48,040 to $49,430; and the maximum yearly contribution base  increased from $192,160 to $197,720.

The maximum contribution bases are the maximum salary amount that an employer must contribute, unless the employer has agreed to pay superannuation contribution on the total salary paid.

END UPDATE