French manufacturing behemoth Thales, a multi-billion dollar defence contractor with the Australian government, was ordered to backpay workers over $7 million in underpaid wages but has avoided any significant fine from the Fair Work ombudsman.

The ombudsman on Friday announced it found Thales Australia underpaid 407 employees a total of $7.44 million between 2011 and 2018 by enlisting workers on annual salaries below their legal enterprise agreement entitlements.

Thales works closely with the Australian Defence Force. Credit:AAP

However beyond repaying its workers, Thales was only instructed to "apologise to its highly-skilled and committed employees" and pay a $200,000 "gesture of contrition" to the government.

It will also be forced to improve its record-keeping and payroll system.