Fair Work Act 2009

An order for the payment of compensation to a person must be an order that the person’s employer at the time of the dismissal pay compensation to the person in lieu of reinstatement.

In determining an amount for the purposes of an order under subsection (1), the FWC must take into account all the circumstances of the case including:

the effect of the order on the viability of the employer’s enterprise; and

the length of the person’s service with the employer; and

the remuneration that the person would have received, or would have been likely to receive, if the person had not been dismissed; and

the efforts of the person (if any) to mitigate the loss suffered by the person because of the dismissal; and

the amount of any remuneration earned by the person from employment or other work during the period between the dismissal and the making of the order for compensation; and

the amount of any income reasonably likely to be so earned by the person during the period between the making of the order for compensation and the actual compensation; and

any other matter that the FWC considers relevant.

If the FWC is satisfied that misconduct of a person contributed to the employer’s decision to dismiss the person, the FWC must reduce the amount it would otherwise order under subsection (1) by an appropriate amount on account of the misconduct.

The amount ordered by the FWC to be paid to a person under subsection (1) must not include a component by way of compensation for shock, distress or humiliation, or other analogous hurt, caused to the person by the manner of the person’s dismissal.

The amount ordered by the FWC to be paid to a person under subsection (1) must not exceed the lesser of:

the amount worked out under subsection (6); and

half the amount of the high income threshold immediately before the dismissal.

The amount is the total of the following amounts:

the total amount of remuneration:

received by the person; or

to which the person was entitled;

if the employee was on leave without pay or without full pay while so employed during any part of that period—the amount of remuneration taken to have been received by the employee for the period of leave in accordance with the regulations.