Good day at the office for HR at Qantas

by Stephanie Zillman09 Aug 2012

Qantas has emerged victorious in its long-running dispute with the Transport Workers’ Union (TWU) over worker pay and conditions, which involved last year’s grounding of aircraft.

One of the key battlegrounds in the industrial stand-off was over the TWU seeking to limit the use of cheaper contract labour to supplement or replace employees covered by the enterprise agreement. Failure to agree on these claims was a major factor behind the escalation of the dispute and the decision by Qantas to ground the airline in October last year.

Fair Work Australia rejected demands such as the capping of outsourced roles through the enterprise agreement, and noted in its decision that “it has not been shown that current Qantas employees have been adversely affected by this practice”. The TWU had been seeking provisions that would limit the use of contractors to 20% of the airline’s workforce. It also sought assurances that those contractors would be engaged under the same conditions as Qantas employees.

Yet the response from Fair Work confirmed that companies have the right to decide how they engage their labour force. “The determination of how to engage labour, the extent to which contractors are utilised and the numbers of employees to be engaged in various categories are classically regarded as matters properly to be determined by the management of an enterprise,” the commissioners said in their judgment. “To interfere with management’s decisions on such a matter would require clear and strong evidence of unfairness. No such case has been established with respect to current employees or otherwise,” the judgment said.

CEO Alan Joyce commented yesterday that the airline always believed that when the facts were on the table, the arbitrator would make the appropriate findings. “Qantas is free to run our business as we see fit and not be dictated to by union officials who do not have the airline's best interests at heart,” head of corporate affairs Olivia Wirth added.

FWA also backed Qantas on pay increases under the agreement, accepting the airline's submission for a 3% per annum rise, rather than the 5% claimed by the TWU.

Yet the union also had a number of significant wins. FWA agreed to backdate the pay increases to July last year whereas Qantas wanted them effective only from the commencement of the determination. The arbitrator also upheld union representatives’ right to be consulted about contracting out, and allowed a provision which will allow employees to receive time-off to develop and put forward alternative cost saving measures if the airline seeks to outsource their role.

Fair Work also ordered Qantas to provide the TWU with a written commitment not to force compulsory redundancies on existing staff as a result of its outsourcing plans. Joyce confirmed yesterday that 2,800 jobs are on the chopping block following plans for restructuring. The plan is expected to yield $300m in savings.


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