Qantas, Australia’s largest airline, is facing sanctions from the Federal Court that could amount to a massive fine for unlawfully terminating over 1,800 employees during the COVID-19 pandemic. This ruling, set to be delivered today, adds to the airline’s recent string of controversies.
In 2020, amid the pandemic’s economic fallout, Qantas opted to outsource various roles, including baggage handlers, cleaners, and ground staff. The court concluded that this decision aimed to weaken the bargaining power of unions during wage negotiations. Qantas, which appealed this ruling to the High Court, had its decision upheld, setting the stage for the upcoming penalty.
The Transport Workers Union has pushed for the full penalty of $121 million, while Qantas is advocating for a lesser fine, estimated between $40 million and $80 million. This fine would be in addition to a prior compensation payment of $120 million the airline made to ground staff for losses incurred from the outsourcing.
Qantas maintains that the actions taken were not intentional violations of the law but rather mistakes made under pressure. Additionally, the airline has recently been embroiled in other legal troubles, including a lawsuit from the Australian Competition and Consumer Commission concerning the sale of tickets for cancelled flights, resulting in a $100 million fine.
During the pandemic, which devastated the aviation industry, Qantas, under the leadership of former CEO Alan Joyce, incurred significant losses. However, Joyce did not directly address the controversy related to the illegal sackings during a recent aviation conference and instead emphasised the airline’s resilience in navigating turbulent times. He underscored that Qantas survived without declaring bankruptcy, claiming that this success was a result of long-term strategic decisions rather than mere luck.
As the court’s decision looms, the scrutiny on Qantas intensifies, with implications that may affect the airline’s reputation and future operational strategies.