Qantas to pay $7.1m to underpaid employees

written by Adam Thorn | March 13, 2020

The Fair Work Ombudsman has ordered Qantas to backpay $7.1 million to 638 employees who were underpaid over eight years.

As well as the lost sums, staff affected will also be paid an extra $1,000 plus interest rate payments of 6 per cent above the cash rate, which totals $2 million.

However, the unusual ruling also identified that more than 80 per cent staff affected by miscalculations were overpaid, too.

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A file image of Qantas aircraft at Sydney Airport. (Rob Finlayson)
A file image of Qantas aircraft at Sydney Airport. (Rob Finlayson)

Qantas said in a statement, “We sincerely apologise to all our employees caught up in this misclassification issue, especially to those who were underpaid as a result. We realise this type of conduct by companies doesn’t meet community expectations, and it doesn’t meet our own commitment to our people or compliance.”

The Fair Work Ombudsman said those affected included head office staff in corporate and administration roles, for payments such as minimum wage, overtime, annual leave entitlements and superannuation.

The airline, which reported itself to the ombudsman after discovering the issues last year, will also pay the regulator a 5.5 per cent contrition payment and has been told to conduct an independent review to uncover if there were any additional underpayments. If so, the airline will face even harsher penalties.

Qantas responded by claiming the calculation issue meant that most staff (83 per cent) were overpaid their base rates and received bonuses they normally shouldn’t.

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“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.

“We take our obligations as an employer very seriously and have worked with the Australian Services Union and Fair Work Ombudsman to fix this.

“Since we first reported this issue in February last year, we’ve put a lot of resources into calculating the full impact, fixing it for those affected and putting systems in place to make sure it doesn’t happen again.”

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