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Qantas ordered to back-pay millions after short-changing staff on JobKeeper

Jessica Yun
·4-min read
qantas plane
Qantas has been ordered to backpay workers a sum that airline unions estimate could be in the millions. (Photo by Sebastian Kahnert/picture alliance via Getty Images)

Qantas has been ordered to back-pay workers millions after the Federal Court ruled that it did not pay workers all the money they were owed in overtime and penalty rates.

In a court case brought by three unions against Qantas, the Court heard Qantas’ payroll system was set up so that a worker’s pay across one fortnight could be split across two pay cycles, where overtime and penalty rates are paid in the following fortnight.

But for the portion to be paid in the subsequent fortnight, the airline deducted the JobKeeper amount of $1,500 from pay that was owed to workers.

In a decision that potentially sets a precedent for future bosses and workers taking part in the wage subsidy scheme, Federal Court Judge Geoffrey Flick stated that the full JobKeeper payment was owed to workers on both weeks.

According to JobKeeper law, “only to the monies an employee is contractually due to receive during any given fortnight for work performed during that same fortnight”, the judge said.

“If the consequence of the interpretation ... is that idiosyncrasies arise in respect to the quantification of amounts that an employee is to receive – including the prospect that employees may benefit from a ‘windfall’ – so be it,” he said.

“It remains a matter for the legislature to “tweak” or adjust the [JobKeeper] scheme if it sees fit.”

In a hypothetical scenario, a worker might have $2,500 in outstanding wages to be paid the following fortnight, and receive $1,500 JobKeeper payment for the current fortnight.

However, the worker – who has been stood down in the second fortnight – still needs to be paid the full $2,500 as well as their second $1,500 JobKeeper payment on top, meaning a total payment of $4,000 for the second fortnight.

(Source: Federal Court)
(Source: Federal Court)

But under this scenario, Qantas would offset the $2,500 with the $1,500 subsidy. This means the worker would be paid the full JobKeeper payment but only $1,000 of the money outstanding from the fortnight before.

The exact amount Qantas is to back-pay workers is yet to be announced, but Yahoo Finance understands that the sum is expected to be in the millions.

‘Wage theft’

The Australian Services Union’s national secretary Linda White said this was the “clearest example of wage theft” seen in the aviation sector.

“The idea that whether someone is paid monthly or fortnightly would affect their right to be paid at all is ridiculous and unprincipled by Qantas.

“Qantas should not be taking pennies out of their workers pockets at such a tough time for workers, especially shortly after announcing a $124 million profit result,” White said.

“Qantas have a legal and moral responsibility to pay workers their penalties, but it used tricky legal manoeuvres to dodge that responsibility.”

Transport Workers Union national secretary Michael Kaine said the Federal Court’s decision was an “important win” for Qantas workers who had “endured systematic wage theft”.

“Qantas management has had the full support of taxpayers during this crisis, receiving $800 million in public funding. It has taken that money and abused our systems, ripping workers off and planning to outsource workers whose jobs the airline admits are needed,” Kaine said.

Qantas responds

However, a Qantas spokesperson denied that the airline deliberately withheld JobKeeper from workers.

“The Federal Court did not accept Qantas or the unions’ interpretation of the JobKeeper scheme but rather adopted its own interpretation.

“It is misleading of unions to suggest employees should expect a sudden windfall out of today’s judgement.

“Qantas has based all of its decisions on JobKeeper on the legislation and guidance provided by the ATO and made sure all employees receive a “safety net” payment of $1500 per fortnight. That “safety net” assurance is a central part of the Government’s JobKeeper policy. Today’s judgement appears to cut across that principle.”

The airline is looking at appealing the judgement, a spokesperson said.

“The judgment will likely have adverse implications for all companies receiving JobKeeper, who are already reeling from the impacts of Covid,” the spokesperson said.

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