The Fair Work Ombudsman has launched Federal Court action to ban Jetstar’s alleged exploitation of foreign flight attendants on domestic routes in Australia, and says it may escalate the action to seek substantial damages on behalf of up to 300 people.
The ombudsman has released a comprehensive statement on its actions:
Thai cabin crew allegedly underpaid on Jetstar domestic routes
Airline cabin crew recruited in Thailand are allegedly staffing domestic routes in Australia for Jetstar Airways for up to half the cost required to meet their minimum entitlements.
The Fair Work Ombudsman says the pay rate is unacceptable and is asking the Federal Court to ban the practice. It claims the Thai employees should be getting up to double the amount they are being paid.
While litigation commenced today involves just eight foreign workers, subject to the findings of the Court, the Fair Work Ombudsman may take further action for up to 300 international cabin crew rostered across Jetstar’s domestic routes.
Facing Court is Singapore company Valuair Limited and Thai company Tour East (T.E.T.) Limited – companies which recruit cabin crew to work exclusively for Jetstar on both international and domestic flights.
Valuair and Tour East are part-owned by Qantas.
The Fair Work Ombudsman is seeking to have Valuair and Tour East reimburse the eight more than $7500 it alleges they are owed in back-pay. It is also seeking penalties against Jetstar Airways Pty Ltd.
Court documents allege Tour East and Valuair pays its cabin crew proportionately for its Australian work up to half of what they are otherwise entitled.
But the Fair Work Ombudsman submits that whilst working on Jetstar’s Australian domestic flights, the crews are entitled to rates stipulated under the Aircraft Cabin Crew Award 2010.
The Fair Work Ombudsman alleges Jetstar Airways was knowingly a party to underpayment contraventions. It alleges Jetstar rosters the foreign cabin crews onto its Australian domestic flights and is aware of the rates they are being paid.
Court documents allege that Jetstar’s contracts with Valuair and Tour East give the airline power to control matters including salary and performance reviews, rostering and duties of the foreign cabin crew.
Jetstar Airways was allegedly also centrally involved in interviewing and recruiting workers in Singapore and Thailand to become employees of Valuair and Tour East. Valuair and Tour East allegedly do not provide cabin crew to any other airline.
A directions hearing is listed for August 17.
The action follows a separate prosecution that began in in April against Australian Jetstar Airways Pty Ltd and Jetstar Group Pty Ltd and New Zealand entity Jetstar Airways Limited concerning a sham scheme under which cadet pilots were exploited by being taken to New Zealand to open bank accounts in that country, and underpaid for flying duties undertaken in Australia by being paid in NZ dollars at NZ labor rates.
The Jetstar practices have been alleged in evidence before Senate hearings as deliberate attempts to avoid Australian taxation and superannuation obligations under Australian law as well as avoid Australian labor laws.
Both FWA actions arose out of concerns raised in public and before various Senate inquires by South Australia independent senator Nick Xenophon.
Senator Xenophon’s office issues this statement a short while ago:
The Fair Work Ombudsman has vindicated ongoing concerns repeatedly
raised by Independent Senator for SA Nick Xenophon about underpayinginternational staff on Australian domestic aviation routes. SenatorXenophon said the FWO’s announcement today that it is prosecuting Jetstar Airways for allegedly underpaying cabin crew recruited in Thailand for Australian domestic flights was a fantastic step in the right direction. I have had serious concerns about this issue and the people it affects for some time, Nick said. The allegations against Jetstar – paying international staff a fraction of Australian wages on domestic routes – is very concerning.
Last night Jetstar issued this statement:
Jetstar will contest the claims alleged by the Fair Work Ombudsman.
While Jetstar does not use overseas-based crew on purely domestic flights, it does use a mix of Australian-based and overseas-based cabin crew on its international flights. These crew are paid based on the terms and conditions in the country in which they are employed, whether they are flying in Singapore, Thailand, or Australia.
At issue is tag flying – an industry term used to describe an international flight that includes a stopover in more than one domestic city, such as Singapore-Darwin-Cairns. Jetstar operates about 40 tag flights a week out of a total schedule of up to 3,000 flights.
Tag flights are common industry practice worldwide.
The Fair Work Ombudsman has filed claims against Thai-based TET and Singapore-based Valuair, two companies used by Jetstar for the supply of cabin crew, as being involved in alleged breaches of the Fair Work Act and the Aircraft Cabin Crew Award.
- During 2012 Jetstar has reduced the number of tag flights it operates from around 60 per week to about 40 per week out of a total number of flights of 3,000.
- In the past six months concentrated tag flying (defined as more than four consecutive tag flights before exiting Australia) accounted for less than 1 per cent of all crew flying in Australia.