Qantas is paying back $7.1 million to 640 marketing and administrative staff it underpaid for up to eight years, with some receiving a windfall of tens of thousands of dollars.
The airline self-reported the underpayment issue in February 2019 and said it involved staff who should have been covered by the enterprise agreement Qantas has with the Australian Services Union but were instead placed on individual contracts.
As a result, they didn’t receive the minimum terms of those agreements, such as overtime, minimum wages and annual leave entitlements, the Fair Work Ombudsman said.
Qantas said that while 65 per cent of the 1000 misclassified employees missed receiving benefits they were owed — such as rostered time off or overtime — 83 per cent of them were better off overall than they would have been under the agreement, because they got higher base salaries and bonuses.
The airline said that from June 2011 to June 2019, it simultaneously underpaid workers by a total of $7.1 million while overpaying them a total of $22 million.
“Qantas will not recover money paid in excess of the agreement and has grandfathered current benefits (such as higher base salaries and bonuses) as well as adding entitlements required by the enterprise agreement, such as rostered days off,” the airline said.
Under a court-enforceable undertaking, Qantas has agreed to repay all workers, with interest, and give each affected worker an additional $1000 payment by April 24.
A spreadsheet on the Fair Work Ombudsman’s website indicates most workers will receive a few thousand dollars but some will get significantly more, with two workers who didn’t get payments for their on-call overtime receiving $141,717.66 and $59,332.10.
The airline will then have to make a “contrition payment” of 5.5 per cent of the underpayments to the Federal Government, expected to be around $400,000.
Australian Services Union assistant national secretary Linda White said that wasn’t nearly enough.
“This isn’t a punishment, it is condonement by the regulator who is supposed to protect workers from abuse,” Ms White said.
“If you can steal $9 million, which would have earned millions in interest over that period and only get fined $390,500, companies will keep doing it, because they profit from the practice.
“The Fair Work Ombudsman has effectively condoned wage theft — this is an insult to Qantas workers who had trusted their employer.”
The Fair Work Ombudsman said that once Qantas finalises its underpayments an outside expert will then review them to ensure all employees have received what they are due, with additional penalties in store if they haven’t.
Numerous Australian companies in the past year have reported they were not paying workers in compliance with Australia’s complex labour laws, including Wesfarmers, Commonwealth Bank, Super Retail Group, Michael Hill Jewellers and the ABC.
Shares in the company were 14.42 per cent lower at $3.115 at 10am on Friday as the coronavirus-driven rout of the market continues apace.
Qantas shares have slipped 59 per cent from an all-time high of $7.46 in December.