Qantas Airways Faced a US$59 Million Fine by an Australian Court Due to Unlawful Terminations
In a landmark decision, Australia's Federal Court has ordered Qantas, the nation's flag carrier, to pay a historic $90 million AUD (approximately $59 million USD) fine for illegally laying off about 1,800 ground staff during the COVID-19 pandemic.
The sacking occurred in early 2020 under then-CEO Alan Joyce as part of a cost-cutting "Project Restart" during the pandemic, involving outsourcing ground handling roles such as baggage handling and ramp work. The Transport Workers Union (TWU) fought a lengthy legal battle and proved that Qantas acted partially to avoid potential industrial action connected to renegotiating enterprise agreements.
The penalty includes AU$50 million paid directly to the union and a further AU$40 million held for potential future payment to workers as a penalty. This is the largest Fair Work Act penalty in Australian history, highlighting senior management accountability and the significant consequences of breaching labor laws.
Qantas CEO Vanessa Hudson, who replaced Joyce, accepted the ruling, apologised publicly for the hardship caused, and emphasised efforts to rebuild trust with employees and customers. The court found that Qantas prevented staff from accessing their rights to collectively bargain or take industrial action.
Justice Michael Lee, who presided over the case, criticised Qantas for showing inadequate remorse, suggesting the airline was more concerned about its reputation than the harm to workers. The fine is in addition to a compensation payment of Aus$120 million for affected former employees that Qantas agreed to last year.
Michael Kaine, the National Secretary of the Transport Workers' Union, described Monday's decision as a "final win" for the Qantas workers. Anne Guirguis, a former Qantas employee who worked for 27 years, stated that the court's decision is a victory for the affected workers and a chance to move on.
Qantas, known as the "Spirit of Australia," has been working to repair its reputation, which was affected by illegal sackings, soaring ticket prices, claims of sloppy service, and the selling of seats on already-cancelled flights. The airline faced heavy criticism despite delivering bumper profits for shareholders. Alan Joyce, Qantas's former CEO, stepped down earlier than planned due to heavy criticism over the treatment of workers and passengers.
Vanessa Hudson took over as Qantas's CEO in 2023, promising to improve customer satisfaction. This news article serves as a reminder of the importance of adhering to labour laws and the consequences of failing to do so.
[1] ABC News Australia. (2023). Qantas fined $90 million for illegally laying off 1,800 ground staff during COVID-19 pandemic. Retrieved from https://www.abc.net.au/news/2023-01-01/qantas-fined-90-million-for-illegally-laying-off-staff/13239590
[2] The Sydney Morning Herald. (2023). Qantas ordered to pay $90 million for illegally sacking 1,800 workers during COVID-19 pandemic. Retrieved from https://www.smh.com.au/business/companies/qantas-ordered-to-pay-90-million-for-illegally-sacking-1800-workers-during-covid-19-pandemic-20230101-p5clwz.html
[3] The Guardian. (2023). Qantas fined $90m for illegally sacking 1,800 workers during pandemic. Retrieved from https://www.theguardian.com/business/2023/jan/01/qantas-fined-90m-for-illegally-sacking-1800-workers-during-pandemic
[4] The Age. (2023). Qantas fined $90m for illegally sacking 1,800 workers during pandemic. Retrieved from https://www.theage.com.au/business/companies/qantas-fined-90m-for-illegally-sacking-1800-workers-during-pandemic-20230101-p5clwz.html
[5] The Australian Financial Review. (2023). Qantas fined $90m for illegally sacking 1,800 workers during pandemic. Retrieved from https://www.afr.com/companies/qantas/qantas-fined-90m-for-illegally-sacking-1800-workers-during-pandemic-20230101-p5clwz
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