Travel agency fined $200k for exploiting worker

Paying staff minimum wage is “just crazy” according to this travel agency manager.

The manager of Melbourne-based Grandcity Travel & Tours, Xu Na, has been fined more than $228,000 for underpaying an employee almost $20,000 over the span of eight months.

Travel Weekly can confirm the agency, which has offices across four states and 8 branches, is neither a member of AFTA nor is ATAS accredited, but claims to be “Australia’s largest Chinese travel agent” on its website which also features a number of accolades from airlines and GDS’ for sales achievements. Manager Xu Na was also awarded “Outstanding Chinese business elite of Australia Award” in 2013, by then Australian prime minister, Kevin Rudd.

Yesterday Xu Na is reported to have told investigators from the Fair Work Ombudsman that Australia’s “minimum (pay) rate is crazy – triple the USA – just crazy”, per a report on Sydney Morning Herald, on the eve of the national minimum wage increase to $17.29 per hour which comes into effect today.

According to the paper, the Federal Circuit Court handed down the judgement yesterday after Xu Na admitted responsibility for underpaying an employee $19,567 over eight months and was penalised $35,496, but her agency faced a far worse verdict and was fined a further $192,840.

The Fair Work Ombudsman was brought into the legal action after inspectors received a request for assistance and discovered a 24-year-old migrant from China who spoke limited English was paid flat hourly rates of between $9 and $11 to work as a casual travel consultant at the agency in Glen-Waverley between January and September 2013, about half of what the employee should have been paid, SMH reports.

The court also found Xu Na and Grandcity had breached “sham contracting laws” by classifying the employee as an “independent contractor”.

According to video evidence presented at court, Grandcity employees were also discouraged from raising issues about pay and conditions, with an email sent to al Grand City l employees in 2013 stating they could easily be replaced, the paper reports.

“The boss pays you to do the work and not to negotiate any work terms and conditions,” the email stated.

The court found that Xu Na and Grandcity had deliberately exploited a vulnerable employee.

“The respondents have demonstrated a complete disregard for the minimum standards contained in the Fair Work Act and (Xu’s) personal interpretation of minimum standards under workplace laws as ‘just crazy’ reinforces the need to demonstrate that compliance with minimum standards is not optional, it’s the law,” Judge O’Sullivan said.

“I am not satisfied she has shown remorse. There is no evidence she has taken steps to ensure that no further breaches will occur.”

Grandcity agencies in Victoria, WA and NSW are expected to continue to operate.

Advertise with us

Email the Travel Weekly team at traveldesk@travelweekly.com.au

Latest comments

Jesse says:
July 1, 2015 at 1:52 pm
Bashing agencies for choosing not to be in AFTA or ATAS, both VOLUNTARY programs is just bad reporting. It’s not a result of not being a member or having accreditation that caused the agency to underpay their employee. It was simply bad management and being greedy on behalf of the owner.
I’m becoming tired of seeing all these stories that denigrate agency owners for making the decision not to feed the shareholders more money or simply not be part of the programs. It doesn’t make an agency “bad” or of lesser quality. There was really no need to even mention it.. This just made the true purpose of the story lose its meaning for me.
Log in to Reply

china Chinese Travel Agency Explotation Fine Grandcity Travel & Tours Na Xu Xu Na