Qantas Airways has just been handed a major penalty of AU$90 million, or approximately $59 million. This costly penalty follows one of more than two years of legal wrangling over unlawful pandemic-related layoffs. This ruling is a major victory for the airline, which had been expecting to win the case. The hefty fine should go towards deterring future misconduct and demonstrates the need for corporate accountability at all levels of labor practices.
The Australian airline faced criticism for its cutthroat approach at the start of the pandemic. Critics especially focused on its plan to outsource 2,000 jobs, a cost-cutting measure expected to save the company AU$125 million ($81 million) per year. This strategy affected thousands of employees. It raised broader questions about how Qantas was running its operations during an incredibly important time period. The penalization includes AU$50 million ($33 million) earmarked for the union, which has approximately 60,000 members. At this stage, a separate hearing is scheduled for determining how to distribute the balance of the AU$40 million ($26 million).
In addition to the fine, Qantas agreed to pay AU$120 million ($78 million) in compensation for selling tickets on thousands of canceled flights. The airline subsequently denied liability for any pay to the employees it had let go. This raised the immediate question of how sincere they were in trying to address the consequences of their decisions.
“We sincerely apologize to each and every one of the 1,820 ground handling employees and to their families who suffered as a result,” – Vanessa Hudson, Qantas CEO.
Hudson recognized the difficulties from the choice to cut jobs, especially at a time filled with ambiguity and uncertainty. She further noted, “The decision to outsource five years ago… caused genuine hardship for many of our former team and their families.” These statements come amidst claims that Qantas’s initial response lacked genuine remorse and was more about damage control than acknowledgment of the impact on workers.
The legal saga exposed Qantas’s costly and punitive litigation strategy. In response to the company’s motion, union representatives claim that for their intervention, the airline’s illegal conduct would have never been addressed. It was the union’s organizing that raised these issues to the national stage. They showed us what it looks like when people come together and take on the big guys.
“But for the union … , Qantas’ contravening conduct would never have been exposed and it would never have been held to account for its unlawful conduct,” – Lee, union representative.
The high court’s unanimous decision on this case is still seen as a landmark development in Australia’s industrial relations scene. Union officials claim this sends the strongest message possible to Qantas. In doing so, it both edifies them and fellow employers, while deterring anyone else from engaging in illegal labor practices.
“It is a significant — the most significant — industrial outcome in Australia’s history and it sends a really clear message to Qantas and to every employer in Australia: Treat your workforce illegally and you will be held accountable,” – Michael Kaine, union leader.
Kaine focused on the importance of standing up against these major corporations. As he closed out the event, he proclaimed, “Against all the odds, we took on a behemoth that had proven to be heartless, and we beat them.” It goes beyond the immediate victory for current workers to establish a new model for future labor clashes in other industries.
