Qantas | Firm admits underpaying staff by more than £5m

Firm admits underpaying staff by more than £5m

The aviation industry is currently in the throes of some of the most extreme market volatility that it has ever seen.

In early March, it was confirmed that international airline Flybe would enter immediate administration following a failed bid to raise emergency funds and added pressure from the current coronavirus outbreak.

Other airlines such as British Airways and Easyjet have slashed prices to encourage those who are hesitant to travel due to health concerns, whilst countries such as Italy and the US have created strict travel bans from countries including the UK to prevent further spread.

However, Qantas is the latest airline to hit headlines after it admitted to underpaying employees by a total of over £5.56million ($7.1million) – a number that looks set to rise even further following an independent audit.

The Fair Work Ombudsman revealed last Friday that the airline had entered into a court-enforced undertaking to reimburse ‘hundreds of workers many millions of dollars’, according to a report released by 7News.

The current estimate, which has already risen from first predictions, affects over 600 current and former employees of the company and took place over a long period of eight years from mid-2011 to mid-2019. Many more could be affected pending the full investigation.

After charges against the employer were officially lodged, Qantas is also required to pay a fine of over £380,000 ($400,000) to federal coffers for incurring the payroll error and failure to act accordingly in good time.

However, Fair Work Ombudsman Sandra Parker stated that the company proactively notified the workplace watchdog itself and has ‘fully cooperated at all stages with the investigation’.

Qantas isn’t the only company to come under fire for underpaying staff.

In January, US department store Barneys blamed a ‘cyber incident’ for failing to pay staff their wages.

According to a company-wide leaked email titled ‘PLEASE READ! Important Payroll Update’, which was sent by Barneys’ HR department on January 3, employees were informed that the delay to their pay was due to an incident with the company’s digital pay systems. The email went on to state that they were ‘likely to be paid’ on January 9, 2020.

The email read: “As you may already know, earlier this week the company experienced a cyber incident that has caused a major disruption to all systems companywide. Unfortunately, it has also impacted the company's ability to process payroll by the normal deadlines established by ADP.

“As a result, this week's payroll will not be paid pursuant to the normal weekly pay cycle and will likely be paid next Thursday, January 9, 2020 (unless the systems are able to be recovered sooner, in which case we will pay as quickly as possible).”

Speaking to Business Insider, a Barneys sales associate who works at the downtown store on 7th Avenue, said at the time that she felt ‘enraged’ by the delay, which left her unable to pay bills, leaving one of her accounts overdrawn.

The anonymous worker added: “There is no morale. People have been leaving at an exponential rate and I know a lot of the managers have been worried about not having enough people on the floor and about us not going in — especially now, because hey we're not getting paid, so why would we?"

Image credit: © The Official News Room of Qantas Airways Limited.

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