Luxury island retreat underpaid staff by more than $20m
Financial Review
Jan 30, 2025
The operators of Hamilton Island’s luxury retreats and leisure facilities have agreed to backpay thousands of staff more than $28 million after admitting to underpaying them minimum rates for almost a decade.
The Fair Work Ombudsman found Hamilton Island Enterprises Ltd – which is owned by the billionaire Oatley family and operates the island’s accommodation as well as the marina, airport, retail stores, restaurants and leisure facilities – underpaid full-time hospitality staff through salaries that were not enough to cover overtime, shift work and weekend penalty rates.
The Hamilton Island Resort in Queensland was underpaying staff for eight years.
HIE’s backpay bill totalled $28.1 million, including $6 million in interest and $500,000 in superannuation. More than 2150 current and former staff were underpaid between 2014 and 2022 and their backpay averaged $8000 with a maximum of $120,000. HIE must also pay a $750,000 contrition payment and conduct training and audits as part of an undertaking with the FWO.
Ombudsman Anna Booth said she had not pursued civil penalties due to HIE’s co-operation. However, she warned insufficient salaries was a problem plaguing all businesses across industries.
“Businesses paying annual salaries cannot take a ‘set and forget’ approach to paying their workers,” she said. “Employers must ensure wages being paid are sufficient to cover all minimum lawful entitlements for the hours their employees are actually working.”
Meanwhile, ASX-listed jewellery brand Lovisa was hit with a class action in the Federal Court for allegedly underpaying about 1000 current and former staff over six years.
Law firm Adero has yet to put a total amount on its claim, which stretches from 2019 to 2025, but says it has received registrations from more than 300 workers so far. The employees are mostly young university students.
Adero argues in its statement of claim that Lovisa failed to pay rest breaks, grant meal breaks or pay staff for attending stores before opening or after closing. Lovisa also allegedly required workers to wear Lovisa jewellery and dress shoes but did not pay them a special clothing allowance.
Lovisa said in a statement it took its Fair Work Act obligations “very seriously”, including paying overtime, and “has processes in place to monitor compliance with employment laws”.
“Lovisa intends to defend the class action proceedings,” the company said.
Departing Lovisa chief executive Victor Herrero is one of the highest-paid executives on the ASX, taking home about $30 million in the 2023 financial year, including long-term incentives.
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Island Resort Underpaying Staff For Eight Years (Read 197 times)
