Exchange rate led to contested exchange

Brown v Pentana Solutions Pty Ltd [2016] FWC 1669 (17 March 2016)

Timing, they say, is everything. And so it proved for an employee who claimed unfair dismissal, arguing he was within jurisdiction because his $US100,000 salary was worth less than the statutory high income threshold. In particular, he argued that his income should be measured over the twelve months preceding his dismissal, to establish the true amount of his salary in AUD terms.

The employer on the other hand argued that because the employee worked in Thailand and not in Australia, he was not even eligible to bring the action at the Fair Work Commission. Further, the employer argued that the employee’s earnings were in excess of the high income threshold.

The FWC agreed to hear the matter on the basis that if the FWC found the employee’s income exceeded the threshold then the employer had no case answer. The other jurisdictional arguments would automatically fall away.

Firstly, the FWC cited existing case law on this matter, indicating that the correct approach is to apply the amount of salary the employee is receiving at the time of the dismissal. The term “at the time” was to be taken literally, namely the day of dismissal.

Then the FWC ascertained what the official USD/AUD exchange rate was on the day nearest to the actual day of dismissal that the Reserve Bank of Australia published exchange rates. (The dismissal took place on a Saturday and no RBA data was published for that day.) On that basis the employee earned at that time, more than the limit, so the case was dismissed, without the other jurisdictional matters being determined.

This decision demonstrates that no matter how complicated the issue of an employee’s salary package is when dealing with the jurisdictional issue, the FWC will look at what was happening right at the time of the dismissal, or as close as possible to that time, as was the case here.