Qantas says multi-employer negotiation could jeopardize flight routes

Credit: AAP Image/Dan Hombrechts

Labour’s omnibus industrial relations reform could impose devastating costs on Australian airlines and call into question the “viability of some services”. Qantas said, as union leaders accuse the carrier of weakening employees’ bargaining power by fragmenting its workforce.

In a November 11 submission to the Education and Employment Legislation Committee, Qantas Group Director Andrew McGinnes and General Counsel Andrew Finch argue that the Secure Jobs, Better Pay Bill will harm to companies because of its approach to multi-employer negotiation and the expansion of arbitration powers for Fair Work. Commission (FWC).

With the reputational setbacks of canceled flights and poor baggage handling fading in the memory of many passengers, Qantas expects profits to reach $1.3 billion in the first half of FY23 alone.

Now, how companies could be grouped into “common” interests in multi-employer industry agreements is one of the airline’s main concerns.

“Targeted industry instruments would be likely to be replaced by potentially industry-wide terms and conditions, which will inevitably test the financial viability of many businesses,” Qantas said.

In the worst-case scenario, multi-employer wage outcomes “decoupled from both productivity and the specific needs and constraints of individual businesses” could significantly increase costs, the airline says.

This pressure will “destroy demand on marginal routes in particular, calling into question the viability of some services,” the submission argues.

“While airlines have mobile assets and can adapt, the implications for tourism would be extremely negative.”

If multi-employer negotiations are to take place, Qantas wants an opt-out system for employers. If this option is not on the table, bargaining power should be “confined” to low-wage sectors such as childcare and elderly care.

Strengthening the FWC’s ability to mediate ‘unresolvable’ bargaining disputes will ‘end Australia’s system of genuine, good faith company negotiations between employers and employees’, it adds.

The FWC is not sufficiently equipped to arbitrate on these matters given the complex shifts and rest periods required by airline personnel, the brief adds.

While Qantas and the labor movement remain strongly opposed to multi-employer bargaining and additional powers for the FWC, the airline has declared its support for the fight against discrimination and efforts to minimize the gender pay gap .

Additionally, the airline has called on lawmakers not to push the legislation through the Senate before the Christmas recess this year, and instead take more time to map its impacts on the business sector.

The submission was sharply reprimanded by the Transport Workers Union (TWU).

In an editorial published in The Australian On Wednesday, TWU National Secretary Michael Kaine accused Qantas of deliberately fragmenting its workforce to fall under separate company bargaining agreements, diminishing the overall bargaining power of its workers.

“Moving bargaining to the corporate level has opened up loopholes through which entities can split the concept of employers into smaller and smaller chunks to avoid bargaining,” Kaine said.

“Qantas is a great example.”

Sally McManus, Secretary of the Australian Council of Trade Unions, said Qantas engages external companies and subsidiaries to “play with the current system”.