Christmas came early for the ex-airline employees
Qantas has been ordered to compensate hundreds of former ground-handling workers in the latest chapter of a five-year legal battle over the airline’s unlawful outsourcing of jobs.
Justice Michael Lee directed that each of the affected former employees receive an interim payment of $3,333 for non‑economic loss, as delays in distributing a much larger compensation pool continued to frustrate workers.
The order comes more than a year after Qantas paid $120 million into a compensation fund administered by law firm Maurice Blackburn, following court findings that the outsourcing of 1,820 ground-handling roles in late 2020 was unlawful.
In court, Lee acknowledged he had received written complaints from former staff about how long it was taking for compensation to reach them. He said the workers’ concerns deserved to be brought to the court’s attention.
He said he understood the frustration over the time taken to get money “into people’s hands” but noted that the administrators could move only as quickly as the information supplied by recipients allowed.
To ensure that at least some money would arrive before the Christmas period – a time of heightened financial pressure for many households – Lee ordered the interim lump-sum payment to all eligible sacked workers.
Of the 1,820 employees whose roles were unlawfully outsourced, the court heard that 1,793 have registered for compensation.
Penalty funds and further distributions
The interim order relates to a broader pool of money tied to the Qantas case. In addition to the $120 million compensation fund, the airline has been hit with a $90 million penalty for its conduct.
Of that penalty, $50 million is allocated to the Transport Workers Union (TWU), which successfully brought the action against Qantas, while the remaining $40 million is to be distributed among the affected workers.
Tuesday’s hearing had been scheduled to finalise how that $40 million balance would be allocated. The court was told that an agreement had been reached between Qantas and the TWU on the framework for distribution.
However, Lee questioned why an additional complex and costly administrative structure – with an estimated price tag of around $150,000 – was needed to implement the payment process. He suggested the task was straightforward enough that “a clerk” should be able to manage it, querying the need to layer on further cost, administration and tax advice.
The agreed plan would see the remaining funds, together with the initial $120 million, distributed based on a percentage allocation tied to each worker’s assessed entitlement, after the interim payment is made.
‘Damage Qantas inflicted on their lives’
TWU national secretary Michael Kaine welcomed the court’s move, saying many of the affected workers would feel relief at finally receiving further financial support before the end of the year.
“These workers loved their jobs and this further $40m from the largest ever penalty on an employer will go a long way towards compensating them for the damage Qantas inflicted on their lives,” Kaine said.
The case has become one of the most high-profile employment law disputes in recent Australian history, with proceedings spanning more than five years and reaching all the way to the High Court.
The Qantas outsourcing saga is not just a legal cautionary tale; it is a culture and leadership story. The court-ordered Christmas payments may bring some relief to affected workers, but the deeper lesson for HR is clear: how you design, communicate and execute major workforce changes – and how you treat people when things go wrong – will shape your organisation’s reputation far more than any single commercial decision.
For HR, the key point is that workforce restructuring is never a purely commercial exercise. Outsourcing, redundancies, and large-scale change must be designed and executed within the boundaries of employment law, industrial instruments and consultation obligations.
