News - News Articles

Business director found to be covered by award – protected by unfair dismissal

Submitted on Wednesday, 9th May 2018

The Fair Work Commission (the “Commission”) has ruled that a Director of Asset Management, employed by a commercial real estate agency earning more than the high-income threshold, was covered by a modern award and therefore protected from unfair dismissal.

The Fair Work Act 2009 stipulates that an employee is protected from unfair dismissal if they have completed the minimum employment period with their employer and is covered by a modern award or enterprise agreement; or award/agreement free and earn less than the high-income threshold ($142,000 - indexed annually).

Following dismissal, the employee applied for an unfair dismissal remedy. Her employer filed a jurisdictional objection arguing the employee was not protected from unfair dismissal as her earnings exceeded the high-income threshold and she was not covered by an award or enterprise agreement.

The employee argued her employment was covered by the Real Estate Industry Award 2010 (the “Award”). The Commission was required to assess whether the employee’s role was covered by the Award. Relevantly, the Commission stated: “The question of whether [the employee] was covered by the Award is to be determined by reference to the principal purpose test”. The Commission went on to consider the decision of the Full Bench of the Australian Industrial Relations Commission in Carpenter v Corona Manufacturing Pty Ltd which recorded:

‘In our view, in determining whether or not a particular award applied to identified employment, more is required than a mere quantitative assessment of the time spent in carrying out various duties. An examination must be made of the nature of the work and the circumstances in which the employee is employed to do the work with a view to ascertaining the principal purpose for which the employee is employed.’

Irrespective of the employee’s title of Director of Asset Management, her duties were consistent with the indicative tasks for a Property Management Supervisor set out in the Award. Indicative tasks included resolving customer complaints, supervising a portfolio of rental properties, providing leadership in the workplace, facilitating change and innovation among further duties. The employee submitted that she “was a property manager with a fancy title”.

The employer submitted during the employee’s employment she performed duties of a higher function which would have exceeded those indicative tasks set out in the Award.

The Commission reviewed whether the employee’s duties were aligned with the classification of the Award. The Commission was “not persuaded that the title of ‘Director” caused Ms Muscat to be elevated beyond the status of an Award employee”. Given this, the Commission concluded the tasks and duties performed by the employee comfortably fell within the coverage of the Award. Therefore, despite holding the ‘Director’ title, the employee had access to unfair dismissal.

Given the Commission found that the employee was covered by the Award there was no need to review her annual earnings. The claim will now proceed to arbitration.

Understand your minimum obligations for the workplace relations regulations by attending our Know your Award training, the training will increase your knowledge of common clauses within modern awards, and assist in classifying your employees within the modern award system.

Written by Nicole Pritchard, Workplace Relations Advice Line Graduate Advisor

Fair Work Commission Decision [2018] FWC 1398

Add comment

Login or register to post comments

Media and Communications Contact

All media enquiries may be directed to the Media and Communications Manager.

For all other enquiries, please contact the Victorian Chamber on (03) 8662 5333.