Qantas: ‘Takes out the trash’ on Friday with settlement announcement on underpayment with Fair Work Ombudsman

Introduction

Back in February 2019, Qantas reported to the Fair Work Ombudsman that it had underpaid some workers. That is 640 workers to the tune of AU$7.1 million. That’s nearly AU$12,000 per person.

What Qantas had done, was employ people on different terms and conditions that were outside the enterprise agreement Qantas had with the Australian Service Union. Some of those employees should have been employed under the enterprise agreement.

Enforceable Agreement

Qantas states that some conditions resulted in overpayments, but that some in underpayments. It’s for those workers that Qantas has entered an enforceable undertaking with the Fair Work Ombudsman to rectifying the misclassification issue affecting approx. 1,000 current and former employees – some 640 of whom were owed AU$7.1 million in back pay.

Qantas will not recover money it paid in excess of the agreement and has ‘grandfathered’ current benefits some employees enjoy (which are better than in the enterprise agreement) as well as adding entitlements required by the enterprise agreement, such as rostered days off.

Employees who received a lower base salary or superannuation than they should have are being paid backpay with interest as well as $1,000 by way of an apology. Qantas hopes to rectify the issue by the end of April 2020.

The Enforceable Undertaking also specifies independent audits for the next three years to ensure full rectification and compliance. Qantas will also have to make a ‘contrition payment’ calculated at 5.5 % of underpayments to employees which it expects to be around AU$400,000.

“We sincerely apologise to all our employees caught up in this misclassification issue, especially to those who were underpaid as a result. We take our obligations as an employer very seriously and have worked with the Australian Services Union and Fair Work Ombudsman to fix this.”

Rob Marcolina, Qantas Group Executive

2PAXfly Takeout

There has been an epidemic of underpayment amongst Australian big business, not to mention semi-government instrumentalities like the ABC – the national broadcaster. Anyone would think we didn’t have computers to sort out these kinds of things.

Although I applaud Qantas for making this right, I find the fact that it happened in the first place deplorable. These businesses have the management and advice resources and technology to make salary and wages payments correct in the first place. To not do so indicates either negligence or a deliberate attitude towards cost savings at the expense of employees.