Airline Boss Did Not Pay Superannuation
Michael James, owner of the defunct Air Australia, did not pay superannuation for his staff a few months before the airline closed down.
Mark Korda said that more than 350 employees of Air Australia were not compensated from December to February. Korda is the administrator of KordaMentha and one of Australia’s experts on business recovery.
But this is not even half of it. Employees who made their contributions for top-up payments to their superannuation also lost their money. The total loss amounted to more than $1.3 million.
And if that wasn’t enough, it looks like James will not be charged criminally. Korda said the compensation scheme of the Federal Government does not cover payments for superannuation.
Korda said that James may owe its staff as much as $4 million in entitlements.
Air Australia has suffered losses in the last few months. Shaun Aisen, the airline’s executive director, left the company in February 2011. With Aisen’s departure, Michael James assumes solo ownership of the company.
A few months later, however, six more employees left the company, including those that hold critical positions like chief operating officer, commercial manager, and the chief executive. These employees left reportedly due to differences in opinions on James’ ability to fix the company after Aisen’s departure.
On April 2011, the company announced that it would change its airline name and implement a rebranding campaign by the end of the year. By December 2011, it also added new service to Honolulu coming from Brisbane and Melbourne.
The Australian Securities and Investments Commission said the issue on the superannuation is under the jurisdiction of the Australian Taxation Office.