Fair Work Ombudsman investigates underpayment claims at Hamilton Island

Hamilton Island’s multimillion-dollar tourism operation has been rocked by claims hundreds of the island’s staff were short-changed – some by thousands of dollars – as the Fair Work Ombudsman investigates.

Hamilton Island’s multimillion-dollar tourism operation – owned by the billionaire yacht-racing Oatley family’s business empire – is being investigated by the Fair Work watchdog over claims hundreds of the Island’s staff were short-changed, some by thousands of dollars.

The Courier-Mail can reveal the Fair Work Ombudsman has launched an investigation into the Island’s manager Hamilton Island Enterprises amid allegations by staff they were underpaid.

The Island was bought in 2003 for $200 million by the Oatley family, known for its tourism, winery and sailing interests, including famed Sydney to Hobart nine-time line honour winner Wild Oats XI.

Its Hamilton Island hotels include Reef View Hotel, Palm Bungalows, Beach Club and luxury hotel qualia, where overnight stays range from $1300 to $6700 for the Beach House, which boasts a 12m infinity edge pool, 10-person dining room and 24-hour chauffeur service.

Sandy Oatley at the Yacht Club on Hamilton Island.

Hamilton Island Enterprises holds a perpetual lease over the Great Barrier Reef island, which also boasts a golf course, marina and its own commercial airport.

Ordinarily, about 1300 staff keep the island running.

Company co-director Sandy Oatley, 69, is the eldest son of the late Bob Oatley, who built the family empire now valued at $1.07 billion.

Assets at the time of the patriarch’s death included a waterfront home in Sydney, an estate in Sardinia overlooking the Mediterranean as well as super yachts.

But the Hamilton Island operation was significantly knocked by COVID-19, with the pandemic shutting tourism down for four months before its reopening last August.

Hamilton Island chief executive Glenn Bourke told the media late last year it was trying to find 200 staff as the Island’s tourism geared back up for Christmas.

It can now be revealed that just weeks later, the company launched a review into its pay practices after a query by the Fair Work Ombudsman, which had received complaints of underpayments.

A company spokesman told the newspaper the pay review launched on December 18 was ongoing.

Hamilton Island was bought by the Oatley family in 2003. Picture: Kara Rosenlund

She said the number of affected staff was not yet known. She refused to say how many staff had received back pay, but said it had begun making payments in February and “continues to do so once employee reconciliations are finalised and audited.”

The company has also appointed external advisers “to independently verify the review of our employee remuneration practices.”

A spokeswoman said initial work indicated some salaried workers may not have been paid correctly, which may have resulted in some staff being underpaid, and others overpaid.

“Any current or former employee who has been underpaid will receive their full entitlement as soon as possible,” she said.

“We believe this issue has arisen as a result of the complexities involved with interpreting the nearly 40 industrial instruments applicable to our scope of operations.

“We unreservedly apologise for any underpayments and are committed to rectifying the situation as quickly as we possibly can.”

A company Q&A released online last year had stated that the review was launched after “discrepancies interpreting award requirements” were identified while installing new payroll software.

A spokesman for the Fair Work Ombudsman this week confirmed it was investigating Hamilton Island Enterprises, but refused to provide any detail as the probe was ongoing.

“We encourage any workers with concerns to contact us directly for assistance,” he said.

One former staff member to contact the newspaper, who asked not to be named, said he was among dozens of employees to complain to the Ombudsman about underpayments.

The ex-employee, who worked at qualia, said he lodged multiple complaints over six months.

Hundreds of staff were allegedly underpaid by Hamilton Island Enterprises. The company has launched a review into its pay practices.

He said he recently received a $4000 back payment, but was not given any specific detail on what period the back pay covered or how it was calculated.

This is despite the company assuring last year that a “breakdown of calculations” would be provided to staff found to be underpaid.

The former employee claimed issues arose after COVID struck, with the company expecting staff to work extra hours rather than hiring new staff.

He has raised concerns about how the overtime was calculated. He also claims that full-time workers were requested by the company in about August to sign “flexible contracts” which stated they would not have guaranteed hours, despite their pay slips stating they were “full time.” The company declined to comment on the claim, by said it was “fully co-operating” with the Ombudsman.

Originally published as Fair Work Ombudsman investigates underpayment claims at Hamilton Island