Airline cabin crew recruited in Thailand have allegedly been staffing domestic routes in Australia for Jetstar — for half the cost of the budget airline's local staff.
The Gillard government's workplace ombudsman has today taken the airline to the Federal Court, saying the pay rate offered to the eight workers involved is not good enough.
The Federal Court action may ultimately involve 300 international cabin crew rostered across Jetstar's domestic routes.
Jetstar has refuted the claims, and a spokeswoman said today it would contest them vigorously when the matter goes to court in August.
The Fair Work Ombudsman is also arguing that the practice of using Asian-owned companies that recruit cabin crew to work exclusively for Jetstar on international and domestic flights should be banned.
Singapore company Valuair Limited and Thai company Tour East Limited – which recruit crew exclusively for Jetstar on both international and domestic flights — are both accused of the practice.
Both firms are part-owned by Qantas.
The Fair Work Ombudsman wants Valuair and Tour East to reimburse the eight cabin crew more than $7500 it alleges they are owed in back-pay. It also wants the Federal Court to fine Jetstar.
It says the cabin crew employees are entitled to be paid under the Aircraft Cabin Crew Award 2010, and not the wage they would be entitled to in Asia.
The ombudsman's writ alleges that Jetstar's contracts with Valuair and Tour East give the airline power to control the cabin crew members' salary, performance reviews and rostering.
Jetstar Airways was also allegedly involved in interviewing and recruiting the workers in Singapore and Thailand.
In April, the ombudsman also commenced action against Jetstar for allegedly hiring trainee pilots from New Zealand on individual contracts, not paying them superannuation, and charging them for training in Australia.
Jetstar released a statement this afternoon that said, while Jetstar did not use overseas-based crew on purely domestic flights, it did use a mix of Australian-based and overseas-based cabin crew on its international services.
''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,'' the statement said.
It said the main issue in dispute was ''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 3000 flights, the statement said.
A directions hearing for the case is listed for August 17.
The Australian and International Pilots Association said today that the Fair Work Ombudsman’s announcement once again illustrated the worrying workplace management at the budget airline.
TAIPA President Captain Barry Jackson said: “We have known for some time that Jetstar has cynically used Thai cabin crew, paid subpar wages, to undercut Australian staff on Jetstar domestic routes.
“They are able to do this by flying an aircraft from Thailand to Australia and then using that aircraft, with crew, to service domestic routes ... I am very grateful to see the Fair Work Ombudsman intervening.''
Senator Nick Xenophon said the Ombudsma’s announcement was a fantastic step in the right direction.
“I have had serious concerns about this issue and the people it affects for some time,” he said.
“The allegations against Jetstar – paying international staff a fraction of Australian wages on domestic routes – is very concerning.
“This sort of alleged behaviour could not only exploit those workers, but it costs Australian jobs.”