Travel agency behemoth Flight Centre has been hit with Federal Court action by trade union Together Queensland over claims of systemic underpayment of employees.
The court action was launched on Friday based on the advice of Maurice Blackburn Lawyers, which has investigated the employee records of five Flight Centre staffers over the last six years.
The investigation found that Flight Centre failed to pay minimum wages, penalty and overtime rates, annual leave and leave loading at the correct rate to the five employees who have come forward, and did not provide the correct rest and meal breaks, according to Together Queensland.
Speaking at a press conference on Friday, Giri Sivaraman from Maurice Blackburn said the calculations for the five employees who were investigated revealed systematic underpayment totalling approximately $250,000.
“What we are saying is Flight Centre has a really dubious pay structure,” he said.
“It means that people are getting paid under the modern retail award, which is the award that they’ve got to comply with, and we’ve brought this claim in the name of the union, Together union, on behalf of the five employees who we say are owed $250,000.”
Flight Centre’s argument is that it has top-up payments for employees whose earnings don’t meet the award level with their retainer and commission. However, Sivaraman said its argument doesn’t stack up.
“We accept that there are some commissions and top-ups. The point is, the is a pay structure where, on your salary, you will earn less than the award,” he said.
“Then there are these at-risk payments that you may never meet – only if you get sales will you get there – that might mean that you get up to the basic safety net; the award level.
“You can’t offset commissions against what you’re entitled to under an award. And with the top-ups, they’re random, inconsistent payments, there’s no rationale, we don’t understand when they’re paid and whether you actually get up to the award level anyway.”
Travel Weekly has contacted Flight Centre for comment.
The court action coincided with Flight Centre’s announcement of a lower profit guidance for FY19 due to its underperforming leisure travel operations in Australia.