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Flight Centre accused of ‘ripping off’ consumers


FLT also under investigation for employee payments

It’s one of the world’s largest travel agent networks, worth around $6.7 billion and employing more than 10,000 staff in Australia alone. 

 

But a new investigation has thrust Flight Centre into the spotlight for the wrong reasons, with claims made against the travel giant of price gauging and underpaying workers. 

 

Dozens of Flight Centre staff and former employees spoke to ABC Investigations, accusing FLT of encouraging travel consultants to gauge customers to the tune of hundreds and sometimes thousands of dollars. 

 

Former worker Olivia Little told the ABC the process is “not a secret thing” and employees are urged to mark up flights during training.

 

Image Getty

 

"Say the flight was $1,500 — they would mark-up and say 'oh the flight is $1,800'. Or if it's a huge business class flight they would mark up a couple of thousand," said Ms Little, who admitted to marking up flights during her 13 months at a NSW Central Coast outlet. 

 

Little added that she had seen other team members doing the same thing on countless occasions. 

 

A current employee, who worked in Melbourne for more than two years, said some workers viewed the practice as a challenge to see how much they could get away with. 

 

“You kind of pick and choose who you do it to," the unnamed woman told the ABC.

 

“You aim for a 10 per cent margin [on top of the cost of the flight]. I know consultants who aim for a 20 per cent margin."

 

Renee Olofsson, a former NSW employee, claimed the procedure kept consumers in the dark about the actual cost of services, and confessed to feeling guilty about the process. 

 

She added that her managers would sometimes even “physically adjust the mark-up using my logins and on my customers". 

 

Although it admits it earns a margin on the products it sells, like other retailers, Flight Centre denied that the practice of price gauging customers was rife among staff and that it never engaged in “excessive marking-up”. 

 

“A central team in Australia proactively monitors margins on individual transactions and action is taken if the margin earned is considered excessive. Action can and has included dismissal,” a Flight Centre spokesperson told the ABC. 

 

“The company strongly believes in a fair margin and refers to this in its philosophies.” 

 

FLT also confirmed the company is currently under investigation by the Fair Work Ombudsman for its payments to staff. 

 

According to the ABC, Flight Centre’s current base wage is $33,500, almost $4,000 below Australia’s minimum wage. 

 

The remaining salary comprises commissions, which FLT claims “motivate our front-line staff to give the customer the best experience possible to ensure they become loyal, repeat customers”. 

 

The company top up pay to the award wage if employees fail to meet their sales targets and commissions. 

 

Flight Centre has now begun negotiations with staff over a new Enterprise Bargaining Agreement.

 


Written by: Mark Harada
Published: 22 August 2018


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