Qantas underpaid workers by misusing JobKeeper scheme, Federal Court has ruled

The Federal Court ruled against Qantas’ interpretation of the JobKeeper wage subsidy program on Thursday.

The arrangement the airline had been following paid workers less than they should have received, Justice Geoffrey Flick judged.

While the decision could mean hundreds of workers are backpaid, the airline called the suggestion “misleading” and is considering appealing.

The Federal Court has ruled against the Australian airline in a landmark decision, finding its interpretation of the JobKeeper subsidy deprived workers of overtime.

Since the wage subsidy was introduced, Qantas had implemented the subsidy in such a way that overtime wasn’t paid until the following fortnightly pay cycle. Such an arrangement, however, reduced the pay of airport staff, baggage handlers and cabin crew, and has been heavily criticised by the unions.

“This is an important win for Qantas workers who have had their pay raided by senior management in a disgraceful abuse of the JobKeeper scheme,” the Transport Workers Union national secretary Michael Kaine said.

“These workers have endured systematic wage theft at the hands of an out of control management.”

To understand the point contention, consider this example used in court. A baggage handler earns $1,500 in wages and $1,500 in overtime in one fortnight before being stood down in the next one.

Rather than receive $3,000 in the first fortnight and be paid $1,500 in the next, courtesy of JobKeeper, they would be paid $1,500 in both. In other words, Qantas came out $1,500 in front and the worker $1,500 behind.

While Qantas maintains this squared with a long-held enterprise agreement, Justice Geoffrey Flick ruled on Thursday that it was inconsistent with way JobKeeper was to be administered.

“The overtime… and the amount received by the employee during the second fortnight being the JobKeeper payment, cannot be ‘set off’ or otherwise called to account by Qantas to relieve it of its obligation to also pay the JobKeeper payment,” Flick said.

While orders have not yet been finalised, Flick said that if the ruling meant that Qantas workers would have to backpay workers, “so be it”.

Qantas told Business Insider Australia that the airline is “carefully considering” whether it will appeal the judgement, and that “it is misleading of unions to suggest employees should expect a sudden windfall”.

“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,” a company spokesperson said.

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

While Flick noted the unions hadn’t argued that Qantas’ interpretation had been made with an ulterior motive, the TWU certainly hasn’t shied away from the allegation outside the courtroom.

“[Workers] have worked overtime, public holidays and weekends and Qantas management has deliberately manipulated JobKeeper so they don’t have to pay workers a dollar more than the public subsidy,” Kaine said.

“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.”

It’s simply the latest war of words between the unions and the airline, both of whom have been locked in a tense struggle over not only this pay dispute but also Qantas’ plan to cut 2,500 ground staff jobs.

The TWU continues to call for CEO Alan Joyce’s resignation and has requested the federal government force Qantas to return taxpayer money.

Qantas has repeatedly denied any deliberate wrongdoing and publicly explained how it has used taxpayer money.

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